[Federal Register Volume 77, Number 225 (Wednesday, November 21, 2012)]
[Proposed Rules]
[Pages 69933-69992]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-27235]
[[Page 69933]]
Vol. 77
Wednesday,
No. 225
November 21, 2012
Part II
Federal Communications Commission
-----------------------------------------------------------------------
47 CFR Parts 1, 27, and 73
Expanding the Economic and Innovation Opportunities of Spectrum Through
Incentive Auctions; Proposed Rule
Federal Register / Vol. 77 , No. 225 / Wednesday, November 21, 2012 /
Proposed Rules
[[Page 69934]]
-----------------------------------------------------------------------
FEDERAL COMMUNICATIONS COMMISSION
47 CFR Parts 1, 27, and 73
[Docket No. 12-268; FCC 12-118]
Expanding the Economic and Innovation Opportunities of Spectrum
Through Incentive Auctions
AGENCY: Federal Communications Commission.
ACTION: Proposed rule.
-----------------------------------------------------------------------
SUMMARY: In the Notice of Proposed Rulemaking, ``Expanding the Economic
and Innovation Opportunities of Spectrum Through Incentive Auctions''
(NPRM), released October 2, 2012, the Commission considers matters
related to the implementation of Congress's mandate to conduct an
incentive auction of broadcast television spectrum as set forth in the
Middle Class Tax Relief and Job Creation Act of 2012 (Spectrum Act).
DATES: Comments for this proceeding are due on or before December 21,
2012; reply comments are due on or before February 19, 2012. Written
PRA comments on the proposed information collection requirements
contained herein must be submitted by the public, Office of Management
and Budget (OMB), and other interested parties on or before January 22,
2013.
ADDRESSES: You may submit comments, identified by Docket No. 12-268
and/or FCC 12-118, by any of the following methods:
Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
Federal Communications Commission's Web Site: http://www.fcc.gov/cgb/ecfs/. Follow the instructions for submitting comments.
Mail: Filings can be sent by hand or messenger delivery,
by commercial overnight courier, or by first-class or overnight U.S.
Postal Service mail (although we continue to experience delays in
receiving U.S. Postal Service mail.) All filings must be addressed to
the Commission's Secretary, Office of the Secretary, Federal
Communications Commission.
People with Disabilities: Contact the FCC to request
reasonable accommodations (accessible format documents, sign language
interpreters, CART, etc.) by email: FCC504@fcc.gov or phone: 202-418-
0530 or TTY: 202-418-0432.
For detailed instructions for submitting comments and additional
information on the rulemaking process, see the SUPPLEMENTARY
INFORMATION section of this document.
In addition to filing comments with the Secretary, a copy of any
PRA comments on the proposed collection requirements contained herein
should be submitted to the Federal Communications Commission via email
to PRA@fcc.gov and to Cathy.Williams@fcc.gov and also to Nicholas A.
Fraser, Office of Management and Budget, via email to Nicholas_A._Fraser@omb.eop.gov or via fax at 202-395-5167.
FOR FURTHER INFORMATION CONTACT: For further information about this
NPRM, please contact Jennifer Manner at (202) 418-3619,
Jennifer.Manner@fcc.gov. For additional information concerning the
Paperwork Reduction Act information collection requirements contained
in this document, send an email to PRA@fcc.gov or contact Cathy
Williams at (202) 418-2918, or via email at Cathy.Williams@fcc.gov.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Notice
of Proposed Rulemaking, FCC 12-118, Docket No. 12-268, adopted on
September 28, 2012, and released on October 2, 2012. The full text of
this document is available for public inspection and copying during
regular business hours in the FCC Reference Center, Federal
Communications Commission, 445 12th Street SW., CY-A257, Washington, DC
20554. These documents will also be available via ECFS (http://www.fcc.gov/cgb/ecfs/). (Documents will be available electronically in
ASCII, Word 97, and/or Adobe Acrobat.) The complete text may be
purchased from the Commission's copy contractor, 445 12th Street SW.,
Room CY-B402, Washington, DC 20554. To request this document in
accessible formats (computer diskettes, large print, audio recording,
and Braille), send an email to fcc504@fcc.gov or call the Commission's
Consumer and Governmental Affairs Bureau at (202) 418-0530 (voice),
(202) 418-0432 (TTY).
Pursuant to Sec. Sec. 1.415 and 1.419 of the Commission's rules,
47 CFR 1.415, 1.419, interested parties may file comments and reply
comments on or before the dates indicated on the first page of this
document. Comments may be filed using: (1) The Commission's Electronic
Comment Filing System (ECFS), (2) the Federal Government's eRulemaking
Portal, or (3) by filing paper copies. See Electronic Filing of
Documents in Rulemaking Proceedings, 63 FR 24121 (1998).
Electronic Filers: Comments may be filed electronically
using the Internet by accessing the ECFS: http://www.fcc.gov/cgb/ecfs/
or the Federal eRulemaking Portal: http://www.regulations.gov. Filers
should follow the instructions provided on the Web site for submitting
comments.
For ECFS filers, if multiple docket or rulemaking numbers
appear in the caption of this proceeding, filers must transmit one
electronic copy of the comments for each docket or rulemaking number
referenced in the caption. In completing the transmittal screen, filers
should include their full name, U.S. Postal Service mailing address,
and the applicable docket or rulemaking number. Parties may also submit
an electronic comment by Internet email. To get filing instructions,
filers should send an email to ecfs@fcc.gov, and include the following
words in the body of the message, ``get form.'' A sample form and
directions will be sent in response.
Paper Filers: Parties who choose to file by paper must
file an original and four copies of each filing. If more than one
docket or rulemaking number appears in the caption of this proceeding,
filers must submit two additional copies for each additional docket or
rulemaking number.
Filings can be sent by hand or messenger delivery, by commercial
overnight courier, or by first-class or overnight U.S. Postal Service
mail (although we continue to experience delays in receiving U.S.
Postal Service mail). All filings must be addressed to the Commission's
Secretary, Office of the Secretary, Federal Communications Commission.
The Commission's contractor will receive hand-delivered or
messenger-delivered paper filings for the Commission's Secretary at FCC
Headquarters building located at 445 12th Street SW., Room TW-A325,
Washington, DC 20054. The filing hours at this location are 8:00 a.m.
to 7:00 p.m. All hand deliveries must be held together with rubber
bands or fasteners. Any envelopes must be disposed of before entering
the building.
Commercial overnight mail (other than U.S. Postal Service
Express Mail and Priority Mail) must be sent to 9300 East Hampton
Drive, Capitol Heights, MD 20743.
U.S. Postal Service first-class, Express, and Priority
mail must be addressed to 445 12th Street SW., Washington DC 20554.
To request materials in accessible formats for people with disabilities
(braille, large print, electronic files, audio format), send an email
to fcc504@fcc.gov or call the Consumer & Governmental Affairs Bureau at
202-418-0530 (voice), 202-418-0432 (tty).
[[Page 69935]]
To view or obtain a copy of this information collection request
(ICR) submitted to OMB: (1) Go to this OMB/GSA Web page: http://www.reginfo.gov/public/do/PRAMain, (2) look for the section of the Web
page called ``Currently Under Review,'' (3) click on the downward-
pointing arrow in the ``Select Agency'' box below the ``Currently Under
Review'' heading, (4) select ``Federal Communications Commission'' from
the list of agencies presented in the ``Select Agency'' box, (5) click
the ``Submit'' button to the right of the ``Select Agency'' box, and
(6) when the list of FCC ICRs currently under review appears, look for
the OMB control number of this ICR as shown in this section (or its
title if there is no OMB control number) and then click on the ICR
Reference Number. A copy of the FCC submission to OMB will be
displayed.
Initial Paperwork Reduction Act of 1995 Analysis
This document contains proposed revised information collection
requirements. As part of its continuing effort to reduce paperwork
burden and as required by the Paperwork Reduction Act (PRA) of 1995 (44
U.S.C. 3501-3520), the Federal Communications Commission invites the
general public and other Federal agencies to comment on the following
information collection(s). Public and agency comments are due January
22, 2013. Comments should address: (a) Whether the proposed collection
of information is necessary for the proper performance of the functions
of the Commission, including whether the information shall have
practical utility; (b) the accuracy of the Commission's burden
estimates; (c) ways to enhance the quality, utility, and clarity of the
information collected; and (d) ways to minimize the burden of the
collection of information on the respondents, including the use of
automated collection techniques or other forms of information
technology. In addition, pursuant to the Small Business Paperwork
Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4), we
seek specific comment on how we might ``further reduce the information
collection burden for small business concerns with fewer than 25
employees.''
OMB Control Numbers: 3060-XXXX.
Title: Reimbursement of Repacking Expenses, Section 73.3700, FCC
Form 399.
Form Numbers: FCC Form 399.
Type of Review: New collection.
Respondents: Business or other for profit entities; Not for profit
institutions; State, local or Tribal government.
Number of Respondents/Responses: 4,166 respondents; 4,166
responses.
Estimated Hours per Response: 0.5-2 hours.
Frequency of Response: One time reporting requirement; On occasion
reporting requirement.
Total Annual Burden: 7,124 hours.
Total Annual Cost: $249,600.
Obligation To Respond: Required to obtain benefits. The statutory
authority for this information collection is contained in sections 1,
4(i) and (j), 7, 154(i), 301, 302, 303, 307, 308, 309, 312, 316, 318,
319, 324, 325, 336 and 337 of the Communications Act of 1934, as
amended.
Nature and Extent of Confidentiality: There is no need for
confidentiality with this collection of information.
Privacy Act Assessment: No impact(s).
Needs and Uses: In the Notice of Proposed Rulemaking (NPRM), FCC
12-118, released by the Commission on October 2, 2012, it is proposed
that, following the completion of the incentive auction process,
eligible stations (full power and Class A television) that are repacked
and multichannel video programming distributors (MPVDs) that incur
expenses as a result of repacking will be eligible for reimbursement.
The Incentive Auction NPRM adopts the following proposed information
collection requirements:
47 CFR 73.3700--All effected entities will be required to file FCC
Form 399. It is proposed that stations and MVPDs will have the option
of choosing to either be reimbursed with an advance payment based on
estimated expenses or reimbursed for their actual, documented expenses.
Stations and MVPDs will have to submit a reimbursement request and
those requesting advance payments will have to later certify that all
funds were properly expended.
OMB Control Numbers: 3060-XXXX.
Title: Channel Sharing Agreements, Section 73.3700.
Form Numbers: Not applicable.
Type of Review: New collection.
Respondents: Business or other for profit entities; Not for profit
institutions; State, local or Tribal government.
Number of Respondents/Responses: 2,254 respondents; 2,254
responses.
Estimated Hours per Response: 1 hr.
Frequency of Response: One time reporting requirement.
Total Annual Burden: 2,254 hours.
Total Annual Cost: $1,217,400.
Obligation To Respond: Required to obtain benefits. The statutory
authority for this information collection is contained in sections 1,
4(i) and (j), 7, 154(i), 301, 302, 303, 307, 308, 309, 312, 316, 318,
319, 324, 325, 336 and 337 of the Communications Act of 1934, as
amended.
Nature and Extent of Confidentiality: There is no need for
confidentiality with this collection of information.
Privacy Act Assessment: No impact(s).
Needs and Uses: In the Notice of Proposed Rulemaking (NPRM), FCC
12-118, released by the Commission on October 2, 2012, it is proposed
that channel sharing bidders be required to include certain terms in
their channel sharing agreements (CSAs) and to file their CSAs with the
Commission. The NPRM adopts the following proposed information
collection requirements:
47 CFR 73.3700--Channel sharing bidders be required to include
certain terms in their CSAs and to file their CSAs with the Commission.
OMB Control Numbers: 3060-XXXX.
Title: Band Transition Activity Station Report, Section 73.3700;
FCC Form 390.
Form Numbers: FCC Form 390.
Type of Review: New collection.
Respondents: Business or other for profit entities; Not for profit
institutions; State, local or Tribal government.
Number of Respondents/Responses: 4,508 respondents; 4,508
responses.
Estimated Hours per Response: 1-85 hours.
Frequency of Response: On occasion reporting requirement; one time
reporting requirement.
Total Annual Burden: 87,719 hours.
Total Annual Cost: $134,400.
Obligation To Respond: Required to obtain benefits. The statutory
authority for this information collection is contained in sections 1,
4(i) and (j), 7, 154(i), 301, 302, 303, 307, 308, 309, 312, 316, 318,
319, 324, 325, 336 and 337 of the Communications Act of 1934, as
amended.
Nature and Extent of Confidentiality: There is no need for
confidentiality with this collection of information.
Privacy Act Assessment: No impact(s).
Needs and Uses: In the Notice of Proposed Rulemaking (NPRM), FCC
12-118, released by the Commission on October 2, 2012, it is proposed
that, following the completion of the incentive auction process,
stations that are repacked to new channel assignments will be required
to conduct consumer education, including on-air announcements of their
new channel assignments, and to submit a Form 390 to report on their
activities. The NPRM adopts the following proposed information
collection requirements:
47 CFR 73.3700--Stations that are repacked to new channel
assignments will be required to conduct consumer
[[Page 69936]]
education, including on-air announcements of their new channel
assignments, and to submit a Form 390 to report on their activities.
OMB Control Numbers: 3060-XXXX.
Title: MVPD Notice, Section 73.3700.
Form Numbers: Not applicable.
Type of Review: New collection.
Respondents: Business or other for profit entities; Not for profit
institutions; State, local or Tribal government.
Number of Respondents/Responses: 2,254 respondents; 2,254
responses.
Estimated Hours per Response: 1-2 hours.
Frequency of Response: One time reporting requirement; Third party
disclosure requirement.
Total Annual Burden: 4,283 hours.
Total Annual Cost: $135,000.
Obligation To Respond: Required to obtain benefits. The statutory
authority for this information collection is contained in sections 1,
4(i) and (j), 7, 154(i), 301, 302, 303, 307, 308, 309, 312, 316, 318,
319, 324, 325, 336 and 337 of the Communications Act of 1934, as
amended.
Nature and Extent of Confidentiality: There is no need for
confidentiality with this collection of information.
Privacy Act Assessment: No impact(s).
Needs and Uses: In the Notice of Proposed Rulemaking (NPRM), FCC
12-118, released by the Commission on October 2, 2012, it is proposed
that, following the completion of the incentive auction process,
stations that are repacked to new channel assignments will be required
to provide notice to multichannel video programming distributors
(MVPDs) so that MVPDs can make the necessary changes to their channel
lineups. The NPRM adopts the following proposed information collection
requirements:
47 CFR 73.3700--The MVPD Notice would be provided in the form of a
letter by stations to the MVPD and would need to contain certain
information.
OMB Control Numbers: 3060-0027.
Title: Application for Construction Permit for Commercial Broadcast
Station, FCC Form 301; 47 CFR Section 73.3700.
Form Numbers: FCC Form 301.
Type of Review: Revision of a currently approved collection.
Respondents: Business or other for profit entities; Not for profit
institutions; State, local or Tribal government.
Number of Respondents/Responses: 6,387 respondents; 9,823
responses.
Estimated Hours per Response: 1-6.25 hours.
Frequency of Response: On occasion reporting requirement; One time
reporting requirement; Third party disclosure requirement.
Total Annual Burden: 31,195 hours.
Total Annual Cost: $107,372,573.
Obligation To Respond: Required to obtain benefits. The statutory
authority for this information collection is contained in sections
154(i), 303 and 308 of the Communications Act of 1934, as amended.
Nature and Extent of Confidentiality: There is no need for
confidentiality with this collection of information.
Privacy Act Assessment: No impact(s).
Needs and Uses: In the Notice of Proposed Rulemaking (NPRM), FCC
12-118, released by the Commission on October 2, 2012, it is proposed
that, following the completion of the incentive auction process, all
repacked full power television stations will need to file FCC Form 301
for their new channel facility. The NPRM adopts the following proposed
information collection requirements:
47 CFR 73.3700--Repacked full power television stations will need
to file FCC Form 301 for their new channel facility.
OMB Control Numbers: 3060-0932.
Title: Application for Authority to Construct or Make Changes in a
Class A Television Broadcast Station, FCC Form 301-CA; 47 CFR Section
74.793(d); 47 CFR Section 73.3700.
Form Numbers: FCC Form 301-CA.
Type of Review: Revision of a currently approved collection.
Respondents: Business or other for profit entities; Not for profit
institutions; State, local or Tribal government.
Number of Respondents/Responses: 871 respondents; 871 responses.
Estimated Hours per Response: 2.50-7 hours.
Frequency of Response: On occasion reporting requirement; One time
reporting requirement; Third party disclosure requirement.
Total Annual Burden: 8,275 hours.
Total Annual Cost: $5,483,360.
Obligation To Respond: Required to obtain benefits. The statutory
authority for this information collection is contained in sections
154(i), 307, 308, 309 and 319 of the Communications Act of 1934, as
amended.
Nature and Extent of Confidentiality: There is no need for
confidentiality with this collection of information.
Privacy Act Assessment: No impact(s).
Needs and Uses: In the Notice of Proposed Rulemaking (NPRM), FCC
12-118, released by the Commission on October 2, 2012,, it is proposed
that, following the completion of the incentive auction process, all
repacked Class A television stations will need to file FCC Form 301-CA
for their new channel facility. The Incentive Auction NPRM adopts the
following proposed information collection requirements:
47 CFR 73.3700--Repacked Class A television stations will need to
file FCC Form 301-CA for their new channel facility.
OMB Control Numbers: 3060-0928.
Title: Application for Class A Television Broadcast Station
Construction Permit or License, FCC Form 302-CA; 47 CFR Section
73.3700.
Form Numbers: FCC Form 302-CA.
Type of Review: Revision of a currently approved collection.
Respondents: Business or other for profit entities; Not for profit
institutions; State, local or Tribal government.
Number of Respondents/Responses: 521 respondents; 521 responses.
Estimated Hours per Response: 2 hours.
Frequency of Response: On occasion reporting requirement; one time
reporting requirement.
Total Annual Burden: 1,042 hours.
Total Annual Cost: $148,485.
Obligation To Respond: Required to obtain benefits. The statutory
authority for this information collection is contained in sections
154(i), 307, 308, 309 and 319 of the Communications Act of 1934, as
amended.
Nature and Extent of Confidentiality: There is no need for
confidentiality with this collection of information.
Privacy Act Assessment: No impact(s).
Needs and Uses: In the Notice of Proposed Rulemaking (NPRM), FCC
12-118, released by the Commission on October 2, 2012, it is proposed
that, following the completion of the incentive auction process, all
channel sharing Class A stations will need to file FCC Form 302-CA for
their shared channel facility. The NPRM adopts the following proposed
information collection requirements:
47 CFR 73.3700--Channel sharing Class A stations will need to file
FCC Form 302-CA for their shared channel facility.
OMB Control Numbers: 3060-0837.
Title: Application for DTV Broadcast Station License, FCC Form 302-
DTV; 47 CFR Section 73.3700.
Form Numbers: FCC Form 302-DTV.
Type of Review: Revision of a currently approved collection.
Respondents: Business or other for profit entities; Not for profit
institutions; State, local or Tribal government.
Number of Respondents/Responses: 2,083 respondents; 2,083
responses.
Estimated Hours per Response: 1-2 hours.
[[Page 69937]]
Frequency of Response: On occasion reporting requirement; One time
reporting requirement.
Total Annual Burden: 2,561 hours.
Total Annual Cost: $1,132,555.
Obligation To Respond: Required to obtain benefits. The statutory
authority for this information collection is contained in sections
154(i), 303, and 308 of the Communications Act of 1934, as amended.
Nature and Extent of Confidentiality: There is no need for
confidentiality with this collection of information.
Privacy Act Assessment: No impact(s).
Needs and Uses: In the Notice of Proposed Rulemaking (NPRM), FCC
12-118, released by the Commission on October 2, 2012, it is proposed
that, following the completion of the incentive auction process, all
channel sharing full power educational stations will need to file FCC
Form 302-DTV for their shared channel facility. The NPRM adopts the
following proposed information collection requirements:
47 CFR 73.3700--Channel sharing stations will need to file FCC Form
302-DTV for their shared channel facility.
OMB Control Numbers: 3060-0029.
Title: Application for Construction Permit for Reserved Channel
Noncommercial Educational Broadcast Station, FCC Form 340; 47 CFR
Section 73.3700.
Form Numbers: FCC Form 340.
Type of Review: Revision of a currently approved collection.
Respondents: Business or other for profit entities; Not for profit
institutions; State, local or Tribal government.
Number of Respondents/Responses: 3,161 respondents; 3,161
responses.
Estimated Hours per Response: 1-6 hours.
Frequency of Response: On occasion reporting requirement; One time
reporting requirement; Third party disclosure requirement.
Total Annual Burden: 7,746 hours.
Total Annual Cost: $30,058,700.
Obligation To Respond: Required to obtain benefits. The statutory
authority for this information collection is contained in sections
154(i), 303 and 308 of the Communications Act of 1934, as amended.
Nature and Extent of Confidentiality: There is no need for
confidentiality with this collection of information.
Privacy Act Assessment: No impact(s).
Needs and Uses: In the Notice of Proposed Rulemaking (NPRM), FCC
12-118, released by the Commission on October 2, 2012, it is proposed
that, following the completion of the incentive auction process, all
repacked full power noncommercial educational stations will need to
file FCC Form 340 for their new channel facility. The NPRM adopts the
following proposed information collection requirements:
47 CFR 73.3700--Repacked noncommercial educational stations will
need to file FCC Form 340 for their new channel facility.
OMB Control Numbers: 3060-0016.
Title: Application for Authority to Construct or Make Changes in a
Low Power TV, TV Translator or TV Booster Station, FCC Form 346; 47 CFR
Section 74.793(d); Section 73.3700, LPTV Repacking Displacement
Application.
Form Numbers: FCC Form 346.
Type of Review: Revision of a currently approved collection.
Respondents: Business or other for profit entities; Not for profit
institutions; State, local or Tribal government.
Number of Respondents/Responses: 9,600 respondents; 9,600
responses.
Estimated Hours per Response: 2.5-9.5 hours.
Frequency of Response: One time reporting requirement; On occasion
time reporting requirement; Third party disclosure requirement.
Total Annual Burden: 30,720 hours.
Total Annual Cost: $15,844,800.
Obligation To Respond: Required to obtain benefits. The statutory
authority for this information collection is contained in sections
154(i), 301, 303, 307, 308 and 309 of the Communications Act of 1934,
as amended.
Nature and Extent of Confidentiality: There is no need for
confidentiality with this collection of information.
Privacy Act Assessment: No impact(s).
Needs and Uses: In the Notice of Proposed Rulemaking (NPRM), FCC
12-118, released by the Commission on October 2, 2012, it is proposed
that, following the completion of the incentive auction process, low
power television stations and TV translator stations may be displaced
from their current operating channel and will be afforded an
opportunity to file a displacement application on FCC Form 346. The
NPRM adopts the following proposed information collection requirements:
47 CFR 73.3700--Following the completion of the incentive auction
process, low power television stations and TV translator stations may
be displaced from their current operating channel and will be afforded
an opportunity to file a displacement application on FCC Form 346.
There is no change in the FCC Form 346 as a result of the proposed
rulemaking being adopted by the Commission.
OMB Control Numbers: 3060-0386.
Title: Special Temporary Authorization (STA) Requests;
Notifications; and Informal Filings; Sections 1.5, 73.1615, 73.1635,
73.1740 and 73.3598; CDBS Informal Forms; Section 74.788; Low Power
Television, TV Translator and Class A Television Digital Transition
Notifications; FCC Form 337; Section 73.3700, Service Rule Waiver in
Lieu of Reimbursement.
Form Numbers: FCC Form 337.
Type of Review: Revision of a currently approved collection.
Respondents: Business or other for profit entities; Not for profit
institutions; State, local or Tribal government.
Number of Respondents/Responses: 7,424 respondents; 7,424
responses.
Estimated Hours per Response: 0.5-4 hours.
Frequency of Response: On occasion reporting requirement; One time
reporting requirement.
Total Annual Burden: 7,124 hours.
Total Annual Cost: $2,382,585.
Obligation To Respond: Required to obtain benefits. The statutory
authority for this information collection is contained in sections 1,
4(i) and (j), 7, 154(i), 301, 302, 303, 307, 308, 309, 312, 316, 318,
319, 324, 325, 336 and 337 of the Communications Act of 1934, as
amended.
Nature and Extent of Confidentiality: There is no need for
confidentiality with this collection of information.
Privacy Act Assessment: No impact(s).
Needs and Uses: In the Notice of Proposed Rulemaking (NPRM), FCC
12-118, released by the Commission on October 2, 2012, it is proposed
that, following the completion of the incentive auction process,
eligible stations that are repacked to new channel assignments may
request a waiver of the service rules in lieu of seeking reimbursement
of their repacking expenses by submitting an informal filing. In
addition, stations that need additional time to relocate to their new
channel assignments may be required to submit a request for extension
of time (FCC Form 337), tolling notification, or request for Special
Temporary Authority (STA). The Incentive Auction NPRM adopts the
following proposed information collection requirements:
47 CFR 73.3700--Entities seeking a service rule waiver in lieu of
reimbursement would be required to file a request for waiver using the
informal filing system. Stations needing additional time to construct
would required to submit a request for extension of time (FCC Form
337), tolling notification, or request for Special Temporary Authority
(STA).
[[Page 69938]]
There is no change in the FCC Form 337 as a result of the proposed
rulemaking being adopted by the Commission.
OMB Control Number: 3060-XXXX.
Title: Sections 1.946, 1.949, 27.10, 27.12, 27.17, etc.--Expanding
the Economic and Innovation Opportunities of Spectrum Through Incentive
Auctions--NPRM, FCC 12-118.
Form Number: N/A.
Type of Review: New collection.
Respondents: Business or other for-profit entities, and state,
local, or tribal government.
Number of Respondents: 101 respondents; 101 responses.
Estimated Time per Response: 1 hour.
Frequency of Response: On occasion and once every 10 year reporting
requirements, recordkeeping requirements, and other third party
disclosure requirements.
Obligation To Respond: Required to obtain or retain benefits.
Statutory authority for these collections are contained in 47 U.S.C.
310(b) of the Communications Act of 1934, as amended.
Total Annual Burden: 31 hours.
Total Annual Cost: $0.
Privacy Impact Assessment: N/A.
Nature and Extent of Confidentiality: There is no need for
confidentiality.
Needs and Uses: The Commission seeks Office of Management and
Budget approval for this new information collection for a full three-
year clearance. On September 28, 2012, the FCC adopted an Expanding the
Economic and Innovation Opportunities of Spectrum Through Incentive
Auctions, Notice of Proposed Rulemaking (NPRM), FCC 12-118, GN Docket
No. 12-268.
The following is a description of each Wireless Broadband Service
Rules section public reporting requirements for Licensees in the 600
MHz Band in the NPRM:
Section 1.946(d) requires 600 MHz licensees to file a construction
notification and certify that they have met the applicable performance
benchmarks.
Section 1.949 requires 600 MHz licensees to file license renewal
applications. Included in the application should be a detailed
description of the: (1) Provision of service during the entire license
period; (2) level and quality of service provided; (3) date service
commenced; (4) whether service was ever interrupted; (5) the duration
of any interruption or outage; (6) the extent to which service is
provided in rural areas; (7) access to spectrum and service provided to
qualifying tribal lands; and (8) any other factors associated with the
level of service to the public.
Section 27.10(d) requires 600 MHz licensees to notify the
Commission within 30 days if a 600 MHz licensee changes, or adds to,
the carrier status on its license.
Section 27.12 requires 600 MHz licensees to comply with certain
foreign ownership reporting requirements.
Section 27.17 requires 600 MHz licensees to notify the Commission
within 10 days if they permanently discontinue service by filing FCC
Forms 601 or 605 and requesting license cancellation.
30 Day Notice Requirement requires 600 MHz licensees, along with TV
broadcasters in the 470-698 MHz band, to provide thirty days' notice to
all incumbent fixed Broadcast Auxiliary Service (BAS) operations within
interference range prior to commencing operations in the vicinity.
The Commission will use the information to ensure 600 MHz
licensees' compliance with required filings of notifications,
certifications, regulatory status changes, and meeting applicable
performance benchmarks. Also, such information will be used to minimize
interference, verify whether 600 MHz applicants are legally and
technically qualified to hold licenses and to determine compliance with
Commission's rules. Any submissions made through the Universal
Licensing System (ULS) must be filed electronically.
These proposals are designed to provide for flexible use of this
spectrum by allowing licensees to choose their type of service
offerings, to encourage innovation and investment in mobile broadband
use in this spectrum, and to provide a stable regulatory environment in
which broadband deployment would be able to develop through the
application of standard terrestrial wireless rules. Without this
information, the Commission would not be able to carry out its
statutory responsibilities.
OMB Control Number: 3060-XXXX.
Title: Application by a Broadcast Licensee to Participate in a
Broadcast Spectrum Incentive Auction (BSIA), FCC Form 177; and Section
1.22002 (NPRM).
Form Number: FCC Form 177.
Type of Review: New collection.
Respondents: Business or other for profit entities; Not-for-profit
institutions; State, local or Tribal government.
Number of Respondents/Responses: 2,254 respondents; 2,254
responses.
Estimated Hours per Response: 3 hours.
Frequency of Response: One time reporting requirement.
Total Annual Burden: 6,762 hours.
Total Annual Cost: N/A.
Obligation To Respond: Required to obtain benefits. The statutory
authority for this information collection is contained in sections
154(i) and 309 of the Communications Act of 1934, as amended.
Nature and Extent of Confidentiality: Pursuant to statute, pending
the effective date of related license reassignments and spectrum
reallocations, the Commission will take all reasonable steps necessary
to protect the confidentiality of Commission-held data of a broadcast
licensee participating in the broadcast spectrum incentive auction. The
NPRM proposed adopting the following rule to comply with this mandate:
47 CFR 1.22006.
Privacy Act Assessment: N/A.
Needs and Uses: The Notice of Proposed Rulemaking, FCC 12-118,
released October 2, 2012 (NPRM) proposes that any broadcast licensee
choosing to participate in the broadcast spectrum incentive auction
must provide information to demonstrate that it is legally,
technically, and financially qualified to participate.
The NPRM proposed adopting the following rules regarding the
collection of information collection from such parties: 47 CFR 1.22000
and 1.22004.
Information collection on the form will include information
regarding the relevant broadcast license, information regarding parties
with an ownership interest in the license, and if applicable,
information regarding any agreement that the applicant may have to
share a broadcast channel in the event that it relinquishes some of its
spectrum usage rights through the auction.
OMB Control Number: 3060-0600.
Title: Application to Participate in a FCC Auction; FCC Form 175;
47 CFR Sections 1.2105, 1.2110 and 1.2112.
Form Number: FCC Form 175.
Type of Review: Revision of a currently approved collection.
Respondents: Business or other for profit entities; Not-for-profit
institutions; State, local or Tribal government.
Number of Respondents/Responses: 500 respondents; 500 responses.
Estimated Hours per Response: 90 minutes.
Frequency of Response: On occasion reporting requirement.
Total Annual Burden: 750 hours.
Total Annual Cost: N/A.
Obligation To Respond: Required to obtain or retain benefits. The
statutory authority for this information collection
[[Page 69939]]
is contained in sections 154(i) and 309 of the Communications Act of
1934, as amended.
Nature and Extent of Confidentiality: There is no need for
confidentiality with this collection of information. Applicants may
request confidential treatment of information collected in FCC Form 175
pursuant to 47 CFR 0.459 of the FCC's rules.
Privacy Act Assessment: N/A.
Needs and Uses: The Notice of Proposed Rulemaking, FCC 12-118,
released October 2, 2012 (NPRM) proposes that any party applying to
participate in any auction specified by statute must certify that it is
not barred by the applicable statutory prohibition against specified
parties participating in the auction. The NPRM proposed to adopting the
following subparagraph to Commission rule 1.2105 regarding the
collection of information collection from such parties: 47 CFR
1.2105(a)(2)(xii).
The Commission will revise the FCC Form 175, if the proposal is
adopted, to require a party to certify compliance with the statutory
requirement prior to submitting the Form.
Synopsis of Notice of Proposed Rulemaking
I. Introduction
1. In its Notice of Proposed Rulemaking, ``Expanding the Economic
and Innovation Opportunities of Spectrum Through Incentive Auctions''
(NPRM), the Commission considers matters related to the implementation
of Congress's mandate to conduct an incentive auction of broadcast
television spectrum as set forth in the Middle Class Tax Relief and Job
Creation Act of 2012, Public Law 112-96, Sec. Sec. 6402, 6403, 125
Stat. 156 (2012) (Spectrum Act).
2. Congress's passage of the Spectrum Act set the stage for this
proceeding and further expanded the Commission's ability to facilitate
technological and economic growth. Wireless broadband is now a key
component of economic growth, job creation and global competitiveness,
and the explosive growth of wireless broadband services has created
increased demand for wireless spectrum. Government entities and private
industry alike have recognized the urgent need for more spectrum for
wireless broadband services, and have been working to increase the
availability of spectrum for these valuable uses. As part of the
American Recovery and Reinvestment Act of 2009, Congress directed the
FCC to develop a ``national broadband plan'' to ensure that every
American has ``access to broadband capability.'' The resulting National
Broadband Plan emphasized the indispensable importance of wireless
spectrum in achieving Congress's broadband goals, recommending that the
Commission make 300 megahertz of spectrum available for mobile
broadband use within five years, including by reallocating a portion of
the broadcast television spectrum.
3. The Spectrum Act authorizes the Commission to conduct incentive
auctions in which licensees may voluntarily relinquish their spectrum
usage rights in order to permit the assignment by auction of new
initial licenses subject to flexible use service rules, in exchange for
a portion of the resulting auction proceeds. Section 6403 of the
Spectrum Act, which is not codified in the Communications Act, requires
the Commission to conduct an incentive auction of the broadcast
television spectrum and includes specific requirements and safeguards
for the required auction.
4. The purpose of the NPRM is to develop rules and policies for the
incentive auction process. The incentive auction will have three major
pieces: (1) A ``reverse auction'' in which broadcast television
licensees submit bids to voluntarily relinquish certain broadcast
rights in exchange for payments; (2) a reorganization or ``repacking''
of the broadcast television bands in order to free up a portion of the
ultra-high frequency (UHF) band for other uses; and (3) a ``forward
auction'' of initial licenses for flexible use of the newly available
spectrum--the ``600 MHz band.''
II. Proposed Auction Design
5. On October 2, 2012 the Commission released a Notice of Proposed
Rulemaking, ``Expanding the Economic and Innovation Opportunities of
Spectrum Through Incentive Auctions'' (NPRM), proposing rules and
seeking comment on a variety of issues related to the implementation of
the congressionally mandated incentive auction of broadcast television
spectrum. An incentive auction is a voluntary, market-based means of
repurposing spectrum by encouraging licensees to voluntarily relinquish
spectrum usage rights in exchange for a share of the proceeds from an
auction of new licenses to use the repurposed spectrum. The broadcast
incentive auction will have three major pieces: (1) A ``reverse
auction'' in which broadcast television licensees submit bids to
voluntarily relinquish spectrum usage rights in exchange for payments;
(2) a reorganization or ``repacking'' of the broadcast television bands
in order to free up a portion of the ultra high frequency (UHF) band
for other uses; and (3) a ``forward auction'' of initial licenses for
flexible use of the newly available spectrum in the UHF band.
6. In the Incentive Auction NPRM, the Commission addresses auction
design issues for the broadcast television spectrum incentive auction.
The reverse and forward auctions present different challenges, but both
can be discussed in terms of three basic auction design elements: (1)
Bid collection procedures that determine how bids in the auction are
gathered, (2) assignment procedures that determine which bids are
accepted, and (3) pricing procedures that determine what each bidder
pays, or in the case of the reverse auction, receives in payment. The
other major component of the incentive auction, the repacking, will
help to determine which reverse auction bids the Commission accepts
and, therefore, is discussed in connection with reverse auction
assignment procedures.
7. The Commission discusses these auction design issues at a high
level and seeks comment on them. The Commission invites broadcasters'
input on how to design the incentive auction so as to facilitate their
participation and make it as easy as possible for them to submit
successful bids, as well as how to structure the auction and repacking
to take into account the interests of broadcasters that will not
participate in the auction. In considering the auction design issues,
the Commission also asks commenters to keep in mind their interrelated
nature, as well as the different trade-offs they pose.
A. Reverse Auction and Broadcaster Repacking
8. The reverse auction will collect information about the price at
which broadcast television spectrum can be cleared. This information,
together with information from the forward auction, will enable the
Commission to identify a set of bidders that would voluntarily
relinquish spectrum usage rights and the compensation each would
receive. In economic terms, the reverse auction is the supply side of
the market for repurposed broadcast television spectrum. The reverse
auction will incorporate three basic auction design elements: it will
collect bids, determine which bids are accepted as winning bids, and
determine the payments made for those winning bids. The determination
of which bids will be accepted depends, in part, on the repacking.
[[Page 69940]]
1. Bid Collection Procedures
9. The Incentive Auction NPRM discusses two options for the first
auction design element that is, collecting bids to voluntarily
relinquish spectrum usage rights in the reverse auction. These
relinquishments may include going off the air, sharing a channel, or
moving to a lower broadcast television band. The first option is a
single round sealed bid procedure, in which bidders would specify,
during a single bidding round, the payment they would be willing to
accept in exchange for relinquishing various spectrum usage rights.
10. The second option is a multiple round, or dynamic, procedure in
which bidders would indicate their willingness to accept iteratively
lower payments in exchange for relinquishing rights. For example, in a
descending clock auction prices would start high and decline over time.
As the price ticks down, stations would indicate whether they would be
willing to relinquish certain spectrum rights at the current prices.
Those that would still be willing to relinquish rights would remain
active in the clock auction, while those that found the current prices
for all the relinquishment options too low would decline all the
offers, exit the auction, and continue broadcasting in their pre-
auction band. The exit decision would be irreversible. The Commission
could also offer bidders the option of submitting a ``proxy bid'' in
advance of the clock auction indicating the minimum payment they would
be willing to accept in exchange for relinquishing spectrum rights,
making it possible for bidders to submit bids just once. The clock
auction would then use the proxy bid to generate and submit bids
dynamically on behalf of the bidder.
11. From the point of view of bidders, a dynamic procedure such as
a clock auction with the option of making proxy bids may be preferable
to a single round sealed bid procedure. A dynamic format does not
require broadcasters to determine an exact bid at the beginning of the
auction. They only need to determine their willingness to relinquish
rights at the current price, which may make participation simpler and
less expensive for bidders. On the other hand, the single round sealed
bid procedure may require less complex software than a multiple round
auction and thus be easier for the Commission to implement. The
Commission seeks comment on these and any other bid collection
procedure options commenters may suggest. Commenters advocating a
particular option should address its advantages and disadvantages,
including cost to bidders and how it would work with the other elements
of the reverse auction.
2. Assignment Procedures
12. Assignment Procedures in General. The second auction design
element--the assignment procedures used to decide which bids are
accepted and which are rejected, thereby determining which stations
remain on the air--is significantly more complicated in this reverse
auction than in a typical auction. The Commission must solve a complex
engineering problem by determining how stations that retain their
current spectrum usage rights are assigned channels (``repacked''),
taking into account relinquishment options including channel sharing
and moves from a UHF to a VHF channel, and consistent with statutory
requirements and other constraints. The Incentive Auction NPRM
discusses the repacking process as it relates directly to the
assignment procedures.
13. The Commission must also analyze whether and how to consider
factors in addition to bid amounts in determining which bids are
accepted and which are rejected. In a reverse auction where bidders are
offering the same good, minimizing the cost of procuring that good
leads to a straightforward rule for determining winners: the lowest
bids win. When the goods being offered are not homogenous, however,
bids are sometimes weighted or scored to account for factors in
addition to bid amount. The goods offered in the reverse auction of
broadcast television spectrum will not be homogenous. For example, some
stations have larger coverage areas and serve greater populations than
others, affecting both their economic value to broadcasters and the
effect of repacking them. Broadcast stations' bids in the reverse
auction could be assigned a score incorporating such factors. Bids from
stations that would make the repacking more difficult because they
would block more potential channel assignments to other stations could
receive a lower score, for example, making them more likely to have
their bids accepted and, equivalently, less likely to be assigned a
channel in their pre-auction band. The score could also be designed to
reflect the fact that the value of a broadcasting license depends in
part on its population served. For a bid to move to VHF, the score may
also account for the scarcity of VHF spectrum in the station's
broadcast area. Selecting bids and paying winning bidders in relation
to their population served or other indicators of value may reduce the
cost of clearing broadcast television spectrum.
14. Incorporation of Repacking Into the Assignment Procedures.
Repacking stations, which involves determining whether it is feasible,
given the applicable constraints, to assign a collection of stations
channels in a particular band, is part of the process for determining
which broadcaster bids will be accepted in the reverse auction, which
bids will not be accepted and what channel numbers will be assigned to
the stations that will remain on the air. It may be helpful to think of
the repacking of stations with different service areas and bid values
into the broadcast television spectrum as being analogous to the
process of packing boxes into a trunk when these boxes have different
sizes and values.
15. The Commission has considered two alternative assignment
procedures. The first uses an integer programming ``algorithm'' (a
mathematical recipe for solving a problem). The second uses a simpler
mathematical recipe that the Incentive Auction NPRM refers to as a
``sequential'' algorithm. Each involves the application of objective
criteria to determine, using the analogy above, the best way to pack
the trunk.
16. Integer Programming Algorithm Approach to Establishing
Assignments. The first procedure would use computer optimization
software to try to find the most efficient way of clearing a specified
amount of broadcast television spectrum while satisfying all applicable
constraints. Integer programming is a collection of mathematical
algorithms that work to find and prove that a feasible solution has the
best objective value of all feasible alternatives. In this case the
software would, for a specified amount of spectrum to be cleared,
minimize the sum of the reverse auction bids accepted and the
relocation costs of stations that are reassigned to new channels. Due
to the complexity of the problem, an ``ideal'' or provably optimal
repacking solution using an integer programming model may not be
feasible in a timely manner. It may be possible, however, to calculate
a close approximation to the optimal solution in a reasonable amount of
computing time. The approximate repacking solution may be highly
efficient--coming close to minimizing the total bids of the cleared
stations, given the amount of spectrum cleared--but it may be less than
fully transparent, since the results cannot easily be replicated. This
procedure also does not generally minimize the Commission's cost of
clearing or maximize the amount of spectrum cleared if the pricing rule
does
[[Page 69941]]
not pay winners their bid amounts, or if the pricing rule does pay
winners their bid amounts but the bidders recognize their incentives to
bid above their true values under this pricing rule.
17. Sequential Algorithm Approach to Establishing Assignments. A
second approach whose results may be easier to replicate is to
sequentially determine, again based on objective criteria, which
stations should be assigned a channel, starting with stations that do
not participate in the auction. For stations that do participate in the
auction, the determination would be based on the scored bids from
highest to lowest, as long as the station can feasibly be assigned a
channel. In a descending clock auction, each bidder is faced with a
declining sequence of price offers for relinquishing spectrum rights.
The bidder can choose to accept an offer, or reject all offers. Once a
bidder rejects all offers, it exits the auction and is assigned to its
pre-auction band. Prior to each auction round, the auction software
determines for each station that has not exited whether it can feasibly
be assigned to its pre-auction band, given the assignments of other
stations. If a station cannot feasibly be assigned to its pre-auction
band, its compensation is set at the last price offer it accepted for
its last preferred relinquishment option. Each station that can be
assigned to its pre-auction band (but has not exited) submits a bid
indicating its preferred relinquishment option at the (reduced) current
prices. The rounds continue until every station has either exited the
auction or can no longer be assigned to its pre-auction band. When the
rounds stop, every bidder that has not exited receives its last
preferred relinquishment option. Bidders that have exited and stations
that did not participate are assigned specific channels in their pre-
auction bands. This sequential algorithm can also be implemented in a
sealed-bid auction. At the beginning of each step of the sequential
algorithm, for each station that has not yet exited, it would be
determined into which bands the station could be feasibly moved. Among
all such feasible moves, the algorithm would implement the move that
minimizes cost on a scored basis. The process would continue until
either the available spectrum is fully packed or there are no more
stations to consider. Stations not selected to remain on the air in
their pre-auction band would be paid to voluntarily relinquish their
broadcasting rights.
18. These alternative assignment algorithms present tradeoffs in
terms of simplicity, transparency and efficiency that must be
considered in determining the auction design. The Commission seeks
comment on these options.
19. The Commission further seeks comment on whether it should
consider in the repacking and assignment procedures whether a given
broadcaster going off the air would create areas without any commercial
or noncommercial broadcast television service. Adding an additional
technical constraint would increase the complexity of the repacking
process, possibly requiring additional time and resources and limiting
the efficiency of the outcome. The Communications Act mandates that the
Commission distribute licenses to provide a fair, efficient and
equitable distribution of service to the several States and
communities. Pursuant to this mandate, the Commission has strongly
disfavored modification of a broadcast station's facilities that would
create a ``white'' or ``gray'' area (an area where the population does
not receive any over-the-air television service on only one over-the-
air service, respectively), or an ``underserved'' area (where the
population in the loss area would receive less than five over-the-air
television signals). How great is the risk of creating ``white'' or
``gray'' areas where the population receives little or no over-the-air
television service as a result of the reverse auction? Should the
Commission seek to address any such risk as an auction design matter or
through other steps outside of the incentive auction?
20. Commission staff has continued work on repacking methodologies
since June 2010, and further evaluation in light of the technical,
policy and auction design issues discussed in the Incentive Auction
NPRM will be required. The Commission recognizes that the approach to
assigning broadcast television channels in this proceeding is novel,
especially because it is part of the incentive auction process. The
Commission also recognizes that it is vital to get input from all
stakeholders. The Commission staff intends to reach out to engage all
stakeholders on issues related to repacking methodologies, in order to
ensure transparency and share ideas and information, and the Commission
seeks comment on the best timing and agenda for such a process.
3. Procedures To Determine Payments
21. The reverse auction must also determine the amount paid to
winning bidders for relinquishing their spectrum rights. Some reverse
auctions pay the winning bidder the amount of its bid. Another
mechanism, known as ``threshold'' pricing, would pay a winning bidder
the highest amount it could have bid and still have had its bid
accepted, as illustrated in Appendix C of the Incentive Auction NPRM.
Threshold pricing gives bidders an incentive to bid its station's value
regardless of the bids submitted by others: if it bids an inflated
value, it may forfeit the opportunity to be bought out at a price at
least as high as the station's value, and if it bids an understated
value, it may relinquish its rights at a price below the station's
value.
22. The Incentive Auction NPRM discusses options for conducting the
reverse auction in a single round or in a multiple round clock format.
The Commission anticipates that in a clock format, a bidder that has
its bid to relinquish spectrum rights accepted would be paid the
threshold price, which is the prevailing clock price at the time its
bid is accepted. In a sealed bid format, the Commission could determine
payment either using the bid amount, or the threshold price. In
choosing between these payment procedures, the Commission will consider
such factors as their likely impact on the cost to the government of
clearing spectrum, the efficiency of assignment, whether they would
increase the complexity of implementing the assignment process, what
impact they may have on bidder incentives, and whether they would
encourage participation in the reverse auction. The Commission seeks
comment on these choices, the factors the Commission should consider in
deciding between them, and on any other considerations it should take
into account.
23. Reserve Price. The Commission also will consider implementing a
reserve price, or maximum payment, that would be made to broadcasters
relinquishing spectrum usage rights. This reserve price could take the
form of a maximum dollar payment to a broadcaster based on
characteristics of the station such as population or viewership. The
Commission seeks comment on the use of a reserve price, and the way it
should be calculated.
B. Forward Auction
24. The forward auction will identify the prices that potential
users of repurposed spectrum would pay for new licenses to use the
spectrum. With this information, together with information from the
reverse auction, the Commission can determine the winning bidders for
new flexible use licenses and the prices those bidders would pay. In
economic terms, whereas the reverse auction defines the supply side of
the market, the forward auction defines the demand side. The forward
[[Page 69942]]
auction piece of the broadcast television spectrum incentive auction
will differ from the typical spectrum license auction in which a fixed
quantity of spectrum is licensed based on a band plan defined in the
service rules. The licenses available in the forward auction will
depend upon how much spectrum the reverse auction clears in specific
geographic areas. That interrelationship may require that the forward
auction be conducted in stages, with bids collected for different
numbers of potentially available licenses.
25. The forward auction will incorporate the three basic auction
design elements discussed above: bid collection procedures, assignment
procedures, and procedures to determine the prices that winning bidders
will pay.
1. Bid Collection Procedures
26. Items Available for Bid. The Commission's typical spectrum
license auctions have collected bids specific to a frequency block in a
geographic area. That is, in auctions with multiple blocks of spectrum
available, bids were collected separately for each block in each
geographic area. Alternatively, where there are multiple blocks of
spectrum available in a geographic area, as the Commission expects to
be the case in the forward auction, it could collect bids for one or
more ``generic'' categories of licenses, such as paired or unpaired
licenses, in a geographic area. Rather than indicating that a bid is
for a specific frequency block in an area, bidders would indicate their
interest in, for example, one or more paired 5 megahertz uplink and 5
megahertz downlink (``5 + 5'') blocks.
27. Multiple Round Bidding Formats. The Commission proposes to
collect forward auction bids using a dynamic auction design format, for
the same reasons that it typically uses a multiple round ascending
auction design in spectrum license auctions. Multiple rounds permit a
process of price discovery, allowing bidders to modify their bidding
strategies in response to changes over the course of the auction in the
absolute and relative prices of different licenses.
28. Two dynamic format options for the forward auction are a
simultaneous multiple round ascending (SMR) auction and an ascending
clock auction. In each, a bidder would indicate the license or licenses
it seeks in a series of ascending price rounds, and would be required
to satisfy an activity requirement, which provides an incentive for
consistent bidding throughout the auction. The two formats differ in
several ways.
29. Bidders submit price bids for specific licenses in the SMR
design typical of past Commission auctions. At the end of each round
the Commission identifies a provisionally winning bidder for each
license that has received bids. When the auction closes (typically
after a round passes where there are no new bids on any licenses), the
provisionally winning bids become final.
30. In contrast, in an ascending clock auction format the
Commission would announce prices for generic licenses in each category
in each geographic area, and bidders would submit quantity bids for the
number of licenses they seek. Prices may differ across categories and
geographic areas, but within each category in each geographic area
every license would sell at the same price. If total demand for the
licenses in a category exceeds supply, the price would be increased for
the next round, but no provisional winners would be chosen. The rounds
would continue until demand for licenses no longer exceeds supply. In a
clock auction, when prices are increased between rounds, the quantity
of licenses sought by bidders could fall so much in a category that
instead of exceeding the supply, the demand is less than the supply.
This possibility of overshooting can be avoided by permitting intra-
round bidding, whereby bidders can indicate their change in demand in
each category at specified prices between the opening and closing
prices in each round.
31. Bidding for generic blocks would be expected to speed up the
forward auction, reducing the time and, therefore, the cost of bidder
participation, since bidders would no longer need to iteratively bid on
the least expensive of several specific but substitutable licenses, as
in a typical Commission SMR auction. The Commission believes that speed
is important to the successful design of the incentive auction for a
number of reasons, including the interdependence of the reverse and
forward auctions.
32. Package Bidding. Bid collection procedures in the forward
auction could include provisions for package bidding--that is, bidders
could be permitted to indicate a single, all-or-nothing bid amount that
would apply to a group of licenses, such as more than one block in a
geographic area or the same block in multiple geographic areas. Package
bidding could be particularly helpful to bidders that face a risk of
winning certain licenses but losing complementary licenses they
consider essential to their business plans. Package bidding options
generally complicate an auction, although such complexity can be
limited if certain restrictions apply to the ways bidders can group
licenses. Package bidding could take a number of specific forms, and
its feasibility and potential usefulness to bidders would depend on
auction design details. The Commission seeks comment on whether bidders
are likely to have interests that may be addressed by package bidding,
and on how package bidding options might work with the other auction
design elements.
2. Assignment Procedures
33. For the forward auction, the assignment procedures will
determine which bidders win which new licenses to use repurposed
broadcast television spectrum, with the number of available licenses in
the forward auction depending on the quantity of spectrum recovered
from the reverse auction. In general, winning forward auction bidders
will be those that place the highest bids on the available licenses. If
bidders are allowed to specify packages or other contingencies, the
assignment procedures would take those conditions into account in
determining a set of best bids that are consistent with the
Commission's forward auction objective of maximizing the aggregate
amount of the bids that the Commission accepts for the available
licenses.
34. The Commission anticipates that if generic blocks are made
available in the forward auction, the assignment procedures would
assign contiguous blocks to bidders that bid for multiple blocks in the
same geographic area and could take into account the need to coordinate
frequencies across adjacent areas. There could also be an additional
auction phase to assign specific frequencies for generic licenses,
which could be based on accepting additional bids. The specific
frequencies that will be available in each area will be determined by
the incentive auction process itself, and bidding on generic blocks
facilitates conducting an auction given those interdependencies.
Further, bidding based on generic blocks will speed completion. The
Commission invites comment on these proposals and, alternatively, on
how it could conduct an auction that would allow bids on specific
frequencies rather than generic blocks.
3. Procedures To Determine License Prices
35. Generally, under the two forward auction design formats
discussed in the Incentive Auction NPRM, the SMR-type auction and a
clock auction, final license prices would be the highest
[[Page 69943]]
amount bid for the license. If there is an additional auction phase to
assign specific frequencies for generic licenses, the Commission would
need additional procedures to determine license prices. The Commission
invites comment on these issues.
C. Integration--Putting the Reverse and Forward Auction Components
Together
36. The reverse and forward auctions must be integrated to
determine how much broadcast television spectrum is to be cleared and
licensed for new uses. The timing of the reverse and forward auctions
will affect the information available when bidding in each auction, and
may also affect the length of the auction process.
37. An option that would provide reverse and forward auction
bidders relevant information from the other side of the market while
they are bidding would be to run the reverse and forward auctions
concurrently in a series of stages. In each stage, the Commission would
specify a provisional quantity of spectrum to be cleared in the reverse
auction and a corresponding quantity of new licenses available in the
forward auction. The first stage would be conducted with the
provisional quantities set at the maximum possible amount of spectrum.
The Commission would compare the provisional outcomes of the forward
and reverse auctions and determine whether the auction closing
conditions had been met--for example, the closing conditions would fail
if total clearing costs in the reverse auction were greater than the
revenue from the forward auction. If the closing conditions are met,
the incentive auction process would end. If not, the Commission would
continue running the forward auction to see if the closing conditions
can be met. If the closing conditions cannot be met, another auction
stage would be run, this time using a smaller provisional quantity of
cleared spectrum and correspondingly smaller number of licenses
available in the forward auction. If closing conditions were met at the
end of this stage, the process would end. If not, additional stages
would be run with the quantity of spectrum sought to be cleared further
reduced, until the auction results met them. In addition to providing
both reverse and forward auction participants with relevant information
from the other side of the market while they are bidding, this approach
is likely to take less time than conducting the auctions sequentially.
38. If the reverse and forward auctions are run sequentially,
conducting the reverse auction first may be preferable, because it
would allow greater certainty about the number of licenses available in
each geographic area in the forward auction, based on broadcaster
participation in the reverse auction. The Commission invites comment on
these issues.
39. Closing Conditions. Section 6403(c)(2) of the Middle Class Tax
Relief and Job Creation Act of 2012, Public Law 112-96, 125 Stat. 156
(2012) (Spectrum Act) requires that the forward auction generate
proceeds sufficient to pay successful bidders in the reverse auction,
cover the Commission's administrative costs, and cover the estimated
costs of reimbursements required by the statute. The Commission seeks
comment on the best way to implement this statutory requirement, and
whether there are additional statutory, policy or other considerations
that should be addressed in establishing the closing conditions.
40. Auctionomics and Power Auctions Report. The Commission has
attached, as Appendix C of the Incentive Auction NPRM, a proposal
developed by its team of expert auction consultants. It suggests an
integrated approach to the broadcast television spectrum incentive
auction: a reverse auction using a descending clock auction procedure
using a sequential algorithm approach for repacking to determine
supply; a forward auction using an ascending clock auction format to
determine demand; and a clearing rule which links the outcome of the
forward and reverse auctions by establishing closing conditions. This
proposal illustrates one potential approach to addressing the auction
design issues discussed in the Incentive Auction NPRM, and the
Commission invites comment on it, as well as other proposed approaches.
41. Cost-Effectiveness Analysis. In connection with its Regulatory
Impact Analysis, the Commission also seeks comment on the cost-
effectiveness of the various auction design elements. In particular,
are there auction design choices the Commission can make that would
make it significantly less costly for bidders to participate in either
the reverse or the forward auction? Are there hidden costs associated
with any of the auction design elements of which the Commission should
be aware?
III. Reverse Auction--Eligibility and Bid Options
A. Eligibility
42. The Incentive Auction NPRM proposes to propose to limit
participation in the reverse auction to full power and Class A
television licensees and to exclude non-Class A low power television
stations and TV translators (collectively, ``low power television
stations''). The Spectrum Act definitions and its repacking and
reimbursement provisions limit participation to only full power and
Class A television licensees. Further, because low power television
stations have secondary interference rights, these facilities do not
impede the band clearing and repacking process, and therefore there is
no reason to facilitate their relinquishment through participation in
the reverse auction. The Incentive Auction NPRM proposes that Class A
television licensees whose status has been changed from Class A to low
power television will be ineligible to participate in the reverse
auction--like all other low power television stations.
43. It is proposed that noncommercial educational television
stations may participate in the reverse auction. The Spectrum Act does
not prohibit participation and the prohibition on subjecting NCEs to
auction in Section 309(j) of the Communications Act would not apply
because the reverse auction is being conducted under a separate Section
309(j) provision. Allowing NCEs to participate will ensure greater
participation in the reverse auction and a return of a greater number
of television channels for reallocation.
44. The Incentive Auction NPRM proposes that entities with original
construction permits be allowed to participate in the reverse auction
if they become licensees before the deadline for submission of the
application to participate in the auction. There are only a very few
entities in this category, and allowing the few original construction
permit holders to participate in the incentive auction, so long as they
receive a license by the deadline specified above, will maximize the
amount of spectrum available for auction.
45. For the reverse auction bidding, it is proposed that the
Commission only examine the spectrum usage rights held by stations in
their licenses as of February 22, 2012. This conforms to the mandate in
Section 6403 of the Spectrum Act that the Commission protect in
repacking the coverage area and population served by a licensee as of
the Spectrum Act enactment date. In contrast, it is proposed that full
power and Class A television licensees with expired, cancelled or
revoked licenses are ineligible to participate in the reverse auction.
The Incentive Auction NPRM seeks comment on these matters.
46. For a new station permittee not licensed on February 22, 2012
(but
[[Page 69944]]
auction eligible because it becomes licensed by the pre-auction
application filing deadline), the Commission proposes to evaluate its
bid based on the spectrum usage rights authorized in the construction
permit it held on February 22, 2012. This approach conforms with the
Commission's proposal to extend repacking protections on public policy
grounds to the facilities authorized in a construction permit for a new
station on February 22, 2012. In order to conform with the mandate in
Section 6403 of the Spectrum Act mandate to make all reasonable efforts
to preserve the coverage area and population served of each television
licensee only as of the Spectrum Act enactment date (February 22,
2012), any modifications made after February 22, 2012 to a licensed
facility or to the construction permit of a new station will not be
considered in evaluating a licensee's spectrum relinquishment offer.
The Commission proposes a different approach for Class A stations that
have not completed their digital transition based on the unique
circumstances involved. For a Class A licensee with no digital license
as of the date of commencement of the reverse auction process, the
Commission proposes to evaluate a reverse auction bid based on the
licensed analog facility as of February 22, 2012. The Incentive Auction
NPRM seeks comment on these proposals.
47. Although the Commission seeks to maximize the spectrum
reclaimed in the reverse auction process, it does not want to
compensate a broadcaster for relinquishing spectrum rights to which it
may no longer be entitled as the result of its license having expired,
or having been cancelled or revoked in an enforcement proceeding.
Therefore, the Commission proposes that any full power or Class A
station with an expired, cancelled or revoked license should not be
eligible to bid in the reverse auction. On the other hand, the
Commission does not want to let the existence of such pending
proceedings impede the auction process. The Commission seeks comment on
how to address enforcement actions that are pending against a station
whose bid to relinquish all usage rights is accepted (winning license
termination bidder). The Commission seeks to identify processes that
would accommodate both its interest in structuring an efficient auction
mechanism and its interest in enforcing broadcasters' compliance with
their legal obligations. As one possible approach to pending
enforcement actions, the Commission seeks comment on whether license
termination bidders should be required to enter into escrow
arrangements to cover the potential costs of forfeitures. In this
regard, the Commission seeks comment on whether to require license
termination bidders to enter into such escrow arrangements either as a
qualification for bidding in the auction, or after being selected as a
winning license termination bidder. Should a ceiling for the escrow
amount that a bidding station could face (in total or per violation) in
the event it is a winning license termination bidder be established in
advance, so that stations would be able to consider that maximum
exposure in advance of developing a reverse auction bid? As an
alternative for winning license termination bidders, the Commission
seeks comment on the option to settle any pending enforcement
proceedings at a fixed amount based on the nature of the alleged
violation. Are there other approaches that would enable disposal of
pending cases in an expedited fashion, while not delaying or
overburdening the auction process? Should the same procedures apply to
a winning license termination bidder that will continue to hold other
broadcast station licenses? Are there other options for handling
pending enforcement actions that would address the concerns and
priorities identified above, short of offering to close the enforcement
actions pending against a winning license termination bidder, with the
legal and policy issues that would raise.
B. Bid Options
48. Section 6403(a)(2) of the Spectrum Act provides that the
reverse auction of broadcast television spectrum ``shall include''
three bid options for participants: (1) Voluntary relinquishment of
``all usage rights with respect to a particular television channel
without receiving in return any usage rights with respect to another
television channel * * *'' (license termination bid); (2) voluntary
relinquishment of ``all usage rights with respect to an ultra high
frequency television channel in return for receiving usage rights with
respect to a very high frequency television channel * * *'' (UHF to VHF
bid); and (3) voluntary relinquishment of ``usage rights in order to
share a television channel with another licensee'' (channel sharing
bid). The Commission invites comment on whether to establish additional
bid options for participants in the reverse auction. Regarding option
(2) above, comment is invited on whether to also allow UHF to VHF
bidders to limit their bids to a ``high VHF channel'' (channels 7-13).
The Commission proposes allowing stations to participate in the reverse
auction by agreeing to relinquish a ``high VHF channel'' (channels 7-
13) in exchange for a ``low VHF channel'' (channels 2-6). Because high
VHF spectrum may be more desirable than low VHF spectrum to a UHF to
VHF bidder, making additional high VHF spectrum available by
encouraging high VHF to low VHF moves may result in a greater reverse
auction participation.
49. The Commission also seeks comment on whether to allow licensees
to participate in the reverse auction by relinquishing spectrum usage
rights through the acceptance of additional interference from other
broadcast stations or reduce their service area or population covered
by a set amount. If licensees were allowed to participate in the
reverse auction by bidding to accept interference from which they
otherwise would be entitled to protection, then would the Commission be
able to accommodate more broadcast stations in the same amount of
spectrum during the repacking process, enabling the clearing of more
spectrum? Similarly, if broadcast licensees were allowed to bid to
reduce their service areas or populations served, could it accommodate
tighter repacking of the broadcast stations? 88. Similarly, should
broadcasters be allowed to bid to accept additional interference from
wireless broadband providers, or to accept a different antenna pattern
or to deploy a distributed transmission system in order to reduce their
signal strength in portions of their service areas and reduce the size
of their service areas? By permitting this type of creative
arrangement, the Commission believes it can potentially create an
unencumbered wireless broadband service area license while still
permitting a broadcast licensee to cover a portion of its service area.
Commenters are invited to address these and other potential bid options
in addition to those required by the statute, as well as the potential
costs and benefits associated with them.
50. The Commission also proposes to prohibit a licensee to
effectuate a channel sharing arrangement that would result in a change
in the station's community of license and/or DMA. The Commission
proposes this limitation because it believes that allowing changes in
community of license in addition to changes in channel assignments
would raise section 307(b) issues such as the fair, efficient, and
equitable distribution of service, and would complicate its repacking
efforts. The Commission proposes that a winning reverse auction bidder
that relinquishes all of its spectrum usage rights with respect to its
pre-incentive auction television channel will retain no
[[Page 69945]]
further rights with regard to that channel. For Class A bidder, since
that service has not completed its transition to digital, the
Commission proposes that a Class A licensee operating paired facilities
must relinquish both if it is a winning license termination bidder. On
the other hand, the Commission proposes to allow winning Class A
channel sharing and UHF to VHF bidders that have paired facilities to
continue operation of their analog facilities on a secondary basis
until the analog facilities are predicted to interfere with a primary
service, or until the September 1, 2015 digital transition deadline for
Class A stations, whichever comes first.
IV. Repacking
51. It is critical, to enable repacking of the broadcast spectrum,
that the Commission determine how to preserve the coverage area and
population served as required by the Spectrum Act. Accordingly, the
Commission seeks comment on engineering and other technical aspects of
the repacking process, in particular Congress's mandate in Section
6403(b)(2) of the Spectrum Act that it make all reasonable efforts to
preserve the coverage area and population served of television stations
in the repacking. The broadcast television spectrum incentive auction
and the associated repacking process could impact both the coverage
area and the population served of television stations. If a station is
assigned to a different channel, then its technical facilities must be
modified in order to replicate its coverage area, because radio signals
propagate differently on different frequencies. These varying
propagation characteristics also mean that a new channel assignment may
change the areas within a station's noise-limited service area affected
by terrain loss. Channel reassignments, and stations going off the air
as a result of the reverse auction, also may change the interference
relationships between stations, which relationships in turn affect
population served. Stations going off the air can eliminate existing
interference to the stations that remain on the air. Likewise, new
channel assignments generally will eliminate interference that the
reassigned stations are now causing or receiving. At the same time, new
channel assignments create a potential for new interference between
nearby stations on the same channel or a first adjacent channel. The
Commission seeks comment on a repacking methodology that takes in
account all of these impacts in order to carry out Congress's mandate
in section 6403(b)(2).
52. The Commission proposes that, during repacking, it would only
preserve the service areas of full power and Class A television
stations with regard to stations' facilities that were licensed, or for
which an application for license to cover authorized facilities already
was on file with the Commission, as of February 22, 2012. Further, the
Commission proposes to protect the facilities set forth in unbuilt
construction permits for new full power television stations as of
February 22, 2012. It did not propose to protect the facilities
contained in pending facility modification applications. The Commission
found that consideration of all pending facility modification
applications would greatly complicate the repacking analysis by
increasing the amount of facilities under consideration in the
repacking process. Additionally, protection of both a licensed facility
and a modification thereto that would expand or alter the station's
service area would further encumber the spectrum.
53. Coverage Area. The Commission proposes to interpret the
statutory term ``coverage area'' to mean a full power television
station's ``service area'' as defined in section 73.622(e) of the
Commission's rules. The rules governing Class A stations do not define
a ``service area'' for such stations. The Commission proposes to use a
Class A station's ``protected contour''--the area within which it is
protected from interference under our rules--as its ``coverage area''
for purposes of the repacking. The Commission's Office of Engineering
and Technology has software that calculates the power and antenna
pattern adjustments necessary to replicate a station's coverage area on
a different channel. The Commission proposes to use that software in
the repacking methodology to replicate the coverage areas of stations
assigned to different channels. Construction of a transmitting antenna
that matches precisely the antenna pattern created by the software is
impractical in some cases, and that the closest practical design might
slightly extend a station's coverage contour (that is, the area within
which the station is protected from interference) in some directions
and decrease it in others. To address such circumstances, the
Commission proposes that a station assigned to a new channel in the
repacking be allowed to continue to use the station's existing antenna
pattern, and to adjust its power level so that the station's coverage
area in total square kilometers is the same as it was before the
repacking, without regard to whether that area is served or unserved by
the station's existing operation. The Commission also proposes to allow
stations to propose alternative transmission facilities to those
specified by its replication software, provided that such facilities
would not extend the coverage area in any direction beyond those
specified by the replication software or cause new interference. 102.
The fact that signal propagation characteristics vary from channel to
channel also means that new channel assignments may change the portions
of a station's coverage area that are affected by terrain losses.
Therefore, the Commission seeks comment on whether it would be
consistent with the Spectrum Act to consider a station's signal to be
receivable at all locations within its noise-limited or protected
contour (depending on whether it is a full power or Class A station)
for purposes of the repacking. If the Commission does not adopt this
approach, how should it accommodate stations whose coverage areas
change as a result of new channel assignments?
54. Population Served. The Commission proposes three alternative
approaches to fulfilling the requirement to make all reasonable efforts
to preserve population served in the repacking process. The first
approach would allow no new interference to a station's population
served as of February 22, 2012. Under this approach, the Commission
would apply the existing standard in section 73.616 that treats
interference of 0.5 percent or less as ``no new interference'' in
evaluating potential channel reassignments. In the second approach, the
statutory mandate would be interpreted to require all reasonable
efforts to preserve service to the same specific viewers for each
eligible station. Under this approach, no individual channel
reassignment, considered alone, could reduce another station's specific
population served on February 22, 2012 by more than 0.5 percent. The
second approach differs from the first approach in two ways. First, it
allows ``replacement interference'' only where interference existed as
of February 22, 2012. Second, it is calculated on a station-to-station
rather than aggregate basis. The Commission seeks comment on this
second approach, including whether to calculate interference on a per
station basis if this approach is adopted. The Commission also seeks
comment on a third option that, like the second option, would consider
interference on a station-to-station, rather than an aggregate, basis.
Under this approach, any interference between two individual stations,
considered by themselves, that
[[Page 69946]]
existed on February 22, 2012, would continue to be allowed regardless
of whether the stations are assigned to different channels in the
repacking.
55. For each of the options, the Incentive Auctions NPRM seeks
comment on the costs and benefits, including quantitative estimates, of
each repacking option in comparison to the others. In that regard,
commenters are invited to address the computational complexity of the
channel assignment process under the first, second and third options--
in determining whether a particular channel assignment is permissible,
the second and third options would require examination of interference
only between channel pairs, whereas the first option would require
examination of all channel assignments--and how that factor should be
considered. In addition, commenters are invited to suggest additional
approaches that would fulfill the statutory mandate while permitting an
efficient repacking of stations. Commenters are invited to submit
appropriate economic studies to support their views or proposals on
these issues. The Commission anticipates that whatever approach adopted
to preserving population served will have a significant impact on the
amount of spectrum available to repurpose for mobile broadband use, as
well as on the overall costs of clearing broadcast television spectrum.
For each of the three options proposed above, therefore, the Incentive
Auctions NPRM invites comment on those assumptions, and on the
potential magnitude of the impact on the amount of spectrum made
available for mobile broadband, as well as the cost of doing so.
56. Protection of Certain Authorized Facilities. In the repacking
process, the Commission proposes to protect the facilities authorized
in unbuilt construction permits for new full power television stations
as of February 22, 2012. The Commission proposes that Class A stations
elect which facilities they would like protected in repacking. Because
Class A stations are in the middle of a Commission-mandated digital
transition that will not conclude until September 1, 2015, the
Commission found that failing to offer repacking protection to those
digital transition facilities not licensed by February 22, 2012 would
be fundamentally unfair. Moreover, failure to protect these facilities
could make it impossible for certain Class A stations to effectuate
their conversion plans, thus stalling the digital transition. The
Commission seeks comment on this proposed procedure, as well as whether
any other authorized full power or Class A television station
facilities should be protected in the repacking process. The Commission
does not propose to extend any protection to facilities proposed in
pending petitions for rulemaking for which a notice of proposed
rulemaking has not been issued, nor does it propose to extend
protection in the repacking process to low power television and
translator stations.
V. Forward Auction--Reconfiguring the UHF Band
A. Allocations
57. Prior to the enactment of the Spectrum Act, the Commission
sought comment in ET Docket No. 10-235 on adding new fixed and mobile
allocations to the UHF and VHF bands. The Commission seeks further
comment on its proposals in light of the Spectrum Act's passage. Its
goal is to adopt a band plan that will provide for flexible use of
these bands for new wireless broadband services while continuing to
support existing uses. In particular, the Commission invites comment on
the views expressed by broadcasters advocating retention of some of the
UHF and VHF television bands exclusively for broadcast use. What are
the benefits and drawbacks of such an approach? What effect would it
have on the Commission's future flexibility to manage the spectrum? As
a practical matter, how could such an approach be implemented, given
that the amount of broadcast spectrum recovered in any specific
geographic area depends on the results of the broadcast television
spectrum incentive auction?
58. In addition, the Commission considers whether to relocate
existing radio astronomy and wireless medical telemetry systems on
channel 37 (608-614 MHz) to new spectrum. In the event that it decides
to do so, it also proposes to add fixed and broadcast allocations to
the channel 37 spectrum and modify the existing land mobile allocation
in the UHF band, which is limited to medical telemetry and telecommand,
to the more general mobile allocation. Similarly, if the Commission
were to make changes to allocations for the channel 37 spectrum, it
asks whether it should remove the radio astronomy allocation from that
spectrum.
B. 600 MHz Band Plan
59. 600 MHz Spectrum Band. We seek comment on the establishment of
a 600 MHz band plan approach using 5 megahertz blocks, in which the
uplink band begins at channel 51 (698 MHz), and, depending on the
amount of spectrum available from the spectrum usage rights that
broadcasters voluntarily relinquish in the reverse auction, will expand
downward toward channel 37. Similarly, the downlink band would begin at
channel 36 (608 MHz) and expand downward based on the amount of
reclaimed spectrum. Under this approach, the downlink band would start
at channel 36, in order to take advantage of the natural separation
between television and wireless operations, given that channel 37 is
presently used for non-broadcast operations. We also propose
establishing guard bands between mobile broadband use and broadcast use
when necessary to create spectrum blocks that are as technically and
functionally interchangeable as possible to allow for enhanced
substitutability among building blocks and flexibility in our auction
design choices. We propose to make the guard band spectrum available
for unlicensed use. We seek comment on this proposal, and on
alternative uses for the guard bands, including approaches that involve
licensing and/or auctioning this spectrum. We note that the Spectrum
Act constrains the Commission to guard bands ``no larger than is
technically reasonable to prevent harmful interference between licensed
services outside the guard bands,'' and requires a forward auction in
which ``the Commission assigns licenses for the use of the spectrum
that the Commission reallocates.'' See Spectrum Act at 6407(b),
6403(c). Under these provisions, we must license the spectrum we
recover through the broadcast television spectrum reorganization, with
the exception of guard bands.
1. Spectrum Block Size
60. To allow for the greatest amount of flexibility and efficiency,
we propose to license the 600 MHz spectrum in 5 megahertz ``building
blocks.'' Five megahertz blocks can support a variety of wireless
broadband technologies. Licensing spectrum in 5 megahertz blocks also
promotes efficiency in converting broadcast television licenses to
flexible-use mobile channels because it is close in size to the 6
megahertz television channels that will be relinquished. Five megahertz
blocks will optimize efficiency in the rebanded spectrum, allowing
wireless spectrum demand in a given market to more closely match the
amount of spectrum supplied by participating broadcasters. We seek
comment on our proposal and whether this block size offers the best
opportunity to use the spectrum efficiently.
61. We also seek comment on licensing the 600 MHz spectrum in six
[[Page 69947]]
megahertz blocks. One advantage of six megahertz blocks is that they
precisely correspond to the size of digital television broadcast
channels relinquished. Because six megahertz blocks do not precisely
map onto the channel sizes used for most wireless broadband
technologies in the market at this time, use of such blocks may result
in spectrum inefficiency. Further, using six megahertz blocks may
reduce the number of blocks auctioned in some circumstances. We seek
comment on the relative costs and benefits of licensing the blocks in 6
megahertz increments.
62. Some prospective 600 MHz licensees may want to obtain spectrum
in larger spectral units--for example, in 10 megahertz blocks. As
discussed above, we are seeking comment on auction design options that
would facilitate the aggregation of larger contiguous blocks composed
of multiple 5 megahertz building blocks. We also anticipate that
licensees could aggregate larger blocks post auction through the
secondary market or using technological approaches such as channel
aggregation. With these aggregation mechanisms in mind, we seek comment
on the extent to which bidders view 5 megahertz building blocks as an
acceptable balance between network performance and our ability to
convert the 6 megahertz broadcast spectrum blocks into terrestrial
wireless spectrum. Would the use of larger blocks (e.g., 10 megahertz
blocks) reduce the amount of spectrum that could be reclaimed in an
auction? Do secondary markets or carrier aggregation technologies
provide sufficient options for aggregating 5 megahertz building blocks?
2. Block Configuration
63. Our proposed band plan provides a general framework that will
allow us to license different amounts of wireless spectrum in different
license areas. We propose to offer a uniform amount of downlink
spectrum nationwide on spectrum formerly allocated for broadcast use
with no in-band television stations, so that wireless service providers
can use uniform mobile device filters and so we can ensure that there
is no interference between television and wireless services. We also
propose to offer varying amounts of uplink spectrum in each service
area, depending on the amount of spectrum available, due to the greater
flexibility to accommodate different filters in base stations than in
mobile terminals. Thus, our band plan aims to pair spectrum for FDD
operations when possible, but may yield varying amounts of unpaired
downlink spectrum blocks in different areas.
64. Paired Blocks. Existing transmission procedures for mobile
broadband FDD operations generally operate on paired spectrum bands, so
pairing spectrum, where possible, will allow mobile broadband providers
to deploy and expand 4G wireless broadband services quickly and
efficiently. We seek comment on our proposal to pair licensed spectrum
when possible. Where we are able to make paired spectrum blocks
available, we propose to auction and license these blocks on a paired
basis. Are there any advantages to ensuring that a certain amount of
spectrum is paired in each license area?
65. Unpaired Spectrum. Although we plan to provide paired spectrum
blocks wherever possible, the relinquished broadcast television
spectrum usage rights that allow us to offer wireless spectrum licenses
will not always fit neatly into pairs in each license area. In order to
maximize the amount of spectrum we can make available, as described
above, where we have excess wireless spectrum that cannot be paired we
propose to offer unpaired downlink spectrum that can serve as
supplemental downlink expansion for FDD operations. In keeping with our
proposed approach of offering a uniform amount of downlink spectrum
nationwide, while allowing variable amounts of uplink spectrum on a
more local basis, we propose to license the unpaired downlink spectrum
in 5 megahertz increments too. These downlink expansion blocks would be
located immediately adjacent to the downlink portion of paired blocks
to minimize interference issues. We seek comment on our proposal to
license unpaired spectrum blocks for downlink expansion. Alternatively,
we seek comment on whether we should auction and license uplink and
downlink spectrum separately. In discussing the amount of paired and
unpaired spectrum that should be allocated for wireless broadband,
commenters should discuss the relative costs and benefits of each
approach.
66. Because wireless broadband traffic tends to be asymmetrical
(i.e., downlink Internet traffic is greater than uplink traffic because
users download more data than they upload), we anticipate that wireless
providers could use this excess downlink spectrum to support their
wireless broadband services in this spectrum band, or supplement their
spectrum holdings in other bands. We seek comment on the extent to
which mobile wireless traffic today is symmetrical or asymmetrical and
on how these patterns are expected to evolve in the future. To what
extent do traffic patterns support the notion of unpaired downlink
expansion blocks?
67. Block Locations. In deciding where to place the uplink and
downlink spectrum bands, we aim to provide the best technical solution
to reduce interference issues between adjacent bands and wireless
operations. We propose an uplink band starting at channel 51 (698 MHz),
and a downlink band beginning at channel 36 (608 MHz) to greatly reduce
interference concerns, and consequently, our need for guard bands.
Specifically, the 600 MHz uplink band will be adjacent to the 700 MHz
uplink band, and therefore we are not proposing a guard band between
the two uplink bands. In addition, we do not anticipate needing a guard
band between the downlink band and existing channel 37 operations
(radio astronomy and wireless medical telemetry), because they
currently operate adjacent to broadcast television bands without
interference. By designating downlink and uplink operations in specific
frequencies, we reduce potential interference with adjacent operations,
thus minimizing the need for guard bands; and we also minimize
interference between wireless operations. We seek comment on this
proposal, including the expected costs and benefits.
3. Offering Different Amounts of Spectrum in Different Markets
68. As explained above, our proposed band plan approach would
accommodate non-uniform amounts of relinquished broadcast TV spectrum
in each geographic area. The alternative--requiring the same amount of
broadcast spectrum to be cleared in all markets--would limit the total
amount of spectrum usage rights that broadcasters can choose to
relinquish and that wireless providers can use for wireless broadband
services.
69. On the other hand, proliferation of band plans is often
considered undesirable from a technical perspective. Multiple band
plans are undesirable because each band plan typically requires a
different design of the filters and/or duplexers in mobile devices to
support those band plans. To balance these two goals, we propose
creating ``families'' of related band plans, and depending on the
amount of spectrum that is relinquished, ``extended families'' of band
plans.
a. Band Plan ``Families'' With Consistent Nationwide Downlink Bandwidth
70. A band plan ``family'' is a group of possible band plans with a
consistent amount of nationwide downlink
[[Page 69948]]
spectrum to allow for market-by-market differences in the quantity of
uplink spectrum. This concept ensures that user devices can operate
nationwide with common receive filter components. The variable amount
of uplink blocks means, however, that base stations in different
markets may require different receive filtering. We believe that due to
form factor, power, and other requirements, it is less costly to
implement differential receive filtering in the base station than in
the mobile device. We seek comment on this premise.
71. For example, if we reclaim 10 broadcast television channels in
most areas, but fewer channels in some areas, we can only offer the
minimum amount of paired blocks available nationwide if we offer the
same amount of uplink spectrum, even though there is more available
wireless spectrum in some areas. In contrast, if we allow for a
variation in the amount of uplink spectrum offered in each area (with a
minimum of one uplink block offered in each area), we can offer more
spectrum: four paired blocks in areas where we clear 10 channels, three
paired blocks where we clear 9 channels, and two paired blocks in areas
where we clear 8 channels. Because we must clear the same amount of
downlink spectrum nationwide for technical reasons, we propose to offer
the unpaired downlink blocks for downlink expansion.
72. In areas where minimal spectrum usage rights are reclaimed
through the reverse auction, we could choose to not clear any spectrum
of broadcast usage rights instead of limiting the amount of downlink
wireless spectrum available nationwide by the amount cleared in these
areas. For example, if we could clear at least 10 TV channels in every
market but one, where we can clear only 3 TV channels, we could choose
not to clear any channels in that market and instead offer wireless
spectrum licenses in all other markets. This would help us to maximize
the amount of wireless spectrum that we can license overall while
avoiding unnecessary disruption of broadcast television service. Where
we choose to clear no TV channels and offer no wireless licenses on
these frequencies, mobile devices operating in these geographic areas
will need to operate on another frequency band (through other assets of
the operator or roaming agreements, for example); therefore, TV
stations in the band will not interfere with those mobile devices.
b. ``Extended Families'' Using Multiple Downlink Band Plans
73. If broadcasters voluntarily relinquish spectrum usage rights in
more spectrum than can be supported in one pass band due to current
technical limitations, we may need to support two downlink band plans
from the outset.
74. In this case, mobile devices would need two filters rather than
one filter to support service in the entire band. Because two filters
are necessary due to technical limitations, there is no additional cost
incurred to support a second band, provided it aligns with the
installed filters. There is a fixed relationship between the two
families, however, because the second family must align with the upper
filter of the first family. Due to this alignment, it is not possible
to arbitrarily combine any two families; only ones that align by having
the number of downlink channels cleared in the smaller family align
with one of the filters used in the larger family. We refer to these
sets of families as ``extended families.''
75. Supporting extended families of band plans significantly
increases the amount of market variation that can be accommodated by
the band plan. There is also significant variation in the uplink to
downlink mix by market in a way that is more variable and uneven than
in the single family case, however. For example, a market with 10
channels cleared is fully symmetric, while a market with 11 channels
cleared is highly asymmetric.
76. Supporting these extended families has certain benefits, but
also some drawbacks. It will extend the range of market clearing
options supported by the band plan, possibly enabling us to allow more
broadcasters to voluntarily relinquish their spectrum usage rights by
allowing us more flexibility for dealing with market variation in the
number of television channels we can clear in each market. However,
this approach adds complexity to the process and requires us to make
assumptions about filter capability to align the families into extended
families. Supporting two band classes also results in additional
interoperability concerns. We seek comment on supporting extended
families of band plans. Should we assume that certain amounts of
spectrum will require two or three filters to implement? If we make
this assumption, should we vary the amount of 600 MHz spectrum
available by market based on the expected number and bandwidth of the
required filters? What are the benefits and drawbacks of this approach?
4. Geographic Area Licensing
77. We propose to license the 600 MHz band using a geographic area
licensing approach, and we seek comment on this proposal. A geographic
area licensing approach is well suited for the types of fixed and
mobile services that would likely be deployed in this band.
Additionally, geographic licensing is consistent with the licensing
approach adopted for other bands that support mobile broadband
services. In the event that interested parties do not support
geographic licensing for the 600 MHz spectrum, those commenters should
explain their position, identify any alternative licensing proposal and
the costs and benefits associated with that alternative.
78. Section 6403(c)(3) of the Spectrum Act directs the Commission
to ``consider assigning licenses that cover geographic areas of a
variety of different sizes.'' We discuss below appropriate geographic
areas for licensing the 600 MHz spectrum and seek comment on how we
should take account of this directive. The Commission has previously
used a variety of geographic area sizes to license spectrum, ranging
from nationwide and large regional areas such as Regional Economic Area
Groups (REAGs) and Major Economic Areas (MEAs) to medium-sized
geographic areas such as Economic Areas (EAs) and Component Economic
Areas (CEAs), to smaller areas such as Metropolitan Statistical Areas/
Rural Statistical Areas (MSAs/RSAs).
79. We are concerned that licensing the 600 MHz spectrum on a
nationwide, or large regional, basis would require the Commission to
reclaim an equal amount of spectrum nationwide, or throughout large
regions. As a result, if only a few broadcasters in one geographic
market voluntarily relinquish their spectrum usage rights, we would be
constrained by that amount of available spectrum as the baseline for
offering wireless spectrum in the broader area. Thus, the spectrum may
not be put to its highest valued use, if broadcasters in other markets
within the area want to relinquish spectrum usage rights and wireless
providers want to purchase licenses for those rights, but cannot
because of the uncleared market. Similarly, using REAGs would present
the same problem of limiting the amount of spectrum that could be
repurposed for wireless broadband because there are only 6 REAGs in the
continental United States.
80. On the other hand, the use of small geographic license areas,
such as MSAs/RSAs, could potentially support much greater variation in
the amount of reclaimed spectrum from area to area, but impose
different tradeoffs. While it is more likely that we can license more
wireless spectrum that is not encumbered by potential interference
[[Page 69949]]
with nearby remaining broadcast television spectrum, having a large
number of very small licenses may raise implementation risks for the
auction designs contemplated in this proceeding. Moreover, more
licenses could complicate potential bidders' efforts to plan for, and
participate in, the auction for such licenses, as well as subsequent
roll-out of service.
81. EAs, which the Bureau of Economic Analysis defines as ``one or
more economic nodes--metropolitan areas or similar areas that serve as
centers of economic activity--and the surrounding counties that are
economically related to the nodes,'' represent a natural market unit
for local or regional service areas. Final Redefinition of the BEA
Economic Areas, 60 FR 13114 (1995). EAs nest within and may be
aggregated up to larger license areas, such as Major Economic Areas
(MEAs) and Regional Economic Area Groupings (REAGs) for operators
seeking larger service areas. Depending on the licensing mechanism we
adopt, licensees may aggregate or otherwise adjust their geographic
coverage through auction or through secondary markets. We believe that
for this spectrum, EA licensing strikes an appropriate balance between
geographic granularity from a spectrum reclamation standpoint and
having a manageable number of licenses from an auction design
standpoint. We propose to license the 600 MHz band on an EA basis and
seek comment on this approach. See 47 CFR 27.6. We ask commenters to
discuss and quantify the economic, technical, and other public interest
considerations of licensing on an EA basis, as well as the impacts this
approach may have on auction design, rural service, and competition.
82. We also seek comment on whether we should use geographic areas
other than EAs. Specifically, we seek comment on using geographic areas
such as CEAs or MSAs/RSAs, which have a greater number of service areas
throughout the United States and the reasons why using these geographic
license sizes are more advantageous than using EAs. We also seek
comment on whether there are certain circumstances in which using
larger--nationwide or regional--licenses would be more appropriate or
advantageous. For example, if we are able to reclaim a large amount of
broadcast television spectrum nationwide or regionally, should we
license a portion of the spectrum on a nationwide or regional basis? We
encourage commenters to consider the auction design implications of any
proposed geographical licensing scheme, as well as any associated costs
and benefits.
83. In addition, we seek comment on whether and how to license
areas outside of the continental United States as the Commission
typically has done. Although we note that the Spectrum Act makes no
special provisions for Alaska and Hawaii, we seek comment on whether
any modifications to our proposed or current regulations are necessary
to accommodate licensing spectrum in these areas. Similarly, if we
decide to include the United States territories in the incentive
auction, are any changes necessary? Finally, should we include the Gulf
of Mexico in our licensing scheme for this spectrum? Should the Gulf of
Mexico be part of another service area(s) or should we separately
license a service area(s) to cover the Gulf of Mexico. Commenters who
advocate a separate service area(s) to cover the Gulf of Mexico should
discuss what boundaries should be used, and whether special
interference protection criteria or performance requirements are
necessary due to the unique radio propagation characteristics and
antenna siting challenges that exist for Gulf licensees.
5. Technical Considerations
a. Guard Bands
84. In order to minimize interference between dissimilar adjacent
operations, we propose to create guard bands in which there are no high
powered operations. These guard bands may be used for low-powered
unlicensed operations that are secondary and cannot cause interference.
To determine the appropriate size of these guard bands, we must take
into account two primary considerations. First, the guard bands must be
large enough to ensure that wireless spectrum blocks adjacent to
television operations or other adjacent high powered operations will
support wireless broadband services to the same level of performance as
spectrum blocks adjacent only to other spectrum blocks used for
wireless broadband service. As described above, we propose creating
spectrum blocks that are as similar and technically interchangeable as
possible to allow for enhanced substitutability across blocks. Second,
section 6407(b) of the Spectrum Act requires that the ``guard bands
shall be no larger than is technically reasonable to prevent harmful
interference between licensed services outside the guard bands.'' We
propose to establish guard bands that meet this requirement.
85. We seek comment on the appropriate size for guard bands. We ask
commenters to provide detailed engineering analysis and data in support
of the guard bands they propose.
86. No Guard Band between 600 MHz Uplink and 700 MHz Uplink
Spectrum. The 600 MHz uplink band is adjacent to the lower 700 MHz A
block (698 MHz to 704 MHz), which is used for terrestrial uplink
services. Because both bands are designed for terrestrial uplink
systems, the new 600 MHz block and the lower 700 A blocks are
harmonized. Generally, we do not allocate any spectrum for guard bands
when adjacent operations are harmonized. Therefore, we are not
proposing a guard band between the 600 MHz uplink spectrum and the
lower 700 MHz spectrum.
87. No Guard Band between 600 MHz Downlink and Channel 37 (Assuming
Existing Channel 37 Operations). In our proposed band plan, the upper
edge of the downlink band borders channel 37, which is not allocated
for broadcast television, but radio astronomy and wireless medical
telemetry. Currently, there is no guard band between television
stations in channels 36 and 38 and the services in channel 37. Because
the proposed in-band and out-of-band emissions of the 600 MHz downlink
band are significantly lower than those of the television stations, we
do not propose a guard band between the 600 MHz downlink band and
channel 37.
88. Guard Band between 600 MHz Uplink and Television. At the lower
edge of the 600 MHz uplink band, the adjacent systems--television
channels used for downlink transmissions and 600 MHz uplink
transmissions from mobile devices--are not harmonized. Interference can
occur at either the television receiver or the mobile broadband base
station receiver, either by out-of-band emissions (OOBE) or by receiver
overload (``blocking'') from the adjacent service. We seek comment on
the appropriate guard band size at the lower edge of the 600 MHz uplink
spectrum to protect both remaining television stations and new wireless
broadband licensees from interference. The Commission has previously
found six megahertz of spectrum separation is sufficient to protect
digital television receivers against 1 MW DTV transmitters. We propose
a six megahertz guard band to protect television operations and 600 MHz
uplink operations. Additionally, below we propose to add ``remainder''
spectrum to the guard bands to further mitigate any potential
interference concerns. We also invite comment on how much guard band
would be sufficient to prevent harmful interference between licensed
services
[[Page 69950]]
outside the guard bands, as well as how to interpret Congress's mandate
that guard bands be ``no larger than technically reasonable.''
89. Specifically, we ask commenters to analyze 600 MHz uplink
interference into digital television receivers within the television
station's protected contour, for receivers using indoor antennas and
receivers using rooftop antennas, as considered in OET 69. OET Bulletin
No. 69, Longley-Rice Methodology for Evaluating TV Coverage and
Interference, page 9 (Feb. 6, 2004) available at http://www.fcc.gov/encyclopedia/oet-bulletins-line. Likewise, we ask commenters to analyze
television station interference into 600 MHz base station receivers. In
addition, we seek input on the types of user equipment (UE) likely to
be deployed in the 600 MHz band (e.g., handheld, laptops, tablets,
fixed modems) and their operations to assist in determining the
likelihood and severity of potential interference. We also seek
information on device characteristics such as EIRP, antenna gain, body
losses at 600 MHz, and the effects of power control on average UE power
level. We also seek data on environmental factors such as typical
interior/exterior wall penetration losses and polarization mismatch.
Furthermore, we invite comments on potential improvements through the
use of filters on digital television transmitters to reduce OOBE into
600 MHz base station receivers and improvements needed to prevent
blocking. Could broadcasters be reimbursed under the Spectrum Act for
installing the improved filters because such filters would increase the
amount of relinquished spectrum that could be made available to
wireless providers?
90. Guard Band between 600 MHz Downlink and Television. The lower
edge of the 600 MHz downlink band and the adjacent television systems
are harmonized to the degree that both systems are downlink, meaning
that each produces transmissions from higher power fixed stations to
smaller, more portable, and more numerous receivers. They are not fully
harmonized, however, because broadcast television stations operate at a
considerably higher power than what we are proposing for 600 MHz base
stations, and television receivers are used differently than we
anticipate 600 MHz devices will be. We seek comment on the appropriate
guard band size to prevent harmful interference to the 600 MHz mobile
broadband and DTV services. Similar to the guard bands between
television and 600 MHz uplink, we propose a guard band of six megahertz
plus remainder spectrum, where available. We also invite comment on how
much guard band would be sufficient to prevent harmful interference
between licensed services outside the guard bands, as well as how to
interpret Congress's mandate that guard bands be ``no larger than
technically reasonable.''
91. Specifically, we ask commenters to analyze interference from
600 MHz base stations into digital television receivers within the
television station's protected contour for digital receivers using
indoor and rooftop antennas. Additionally for this guard band, we are
requesting commenters to analyze interference from television stations
into 600 MHz mobile devices. We also invite comments on potential
improvements through the use of filters on digital television
transmitters to reduce OOBE into 600 MHz mobile receivers and
improvements needed to prevent blocking. With respect to analyzing
interference to 600 MHz downlink from television stations, we ask that
commenters provide data to evaluate several scenarios for filtering and
colocation, including: (1) Using existing mask digital television
transmit filters with 600 MHz base station and television facilities
not colocated; (2) using existing mask DTV transmit filters with 600
MHz base station and television facilities colocated; and (3) using
improved mask digital television transmit filters, with 600 MHz base
station and television facilities colocated. To support this analysis,
commenters should provide data on the types of user equipment, their
operational use, and device receiver characteristics such as antenna
gain, body losses, adjacent channel rejection and blocking
characteristics. In addition, commenters should justify any assumptions
they make in their analysis.
b. Interoperability Considerations
92. Each band plan supported by a device requires a separate
duplexer (or filter, in the case of Time Division Duplex (TDD) bands),
and associated components. So, if we choose to clear different amounts
of downlink spectrum in different markets, mobile device manufacturers
would need to create separate duplexers for different markets or risk
interference in areas where we cleared less spectrum for wireless use
(to and from remaining broadcast television operations, for example).
Supporting multiple band plans would increase the cost, size, and/or
complexity of these devices. We seek comment on whether we should
minimize the number of band plans that need to be supported in mobile
devices using the 600 MHz spectrum by creating uniform downlink
spectrum nationwide. Given that most user devices already support many
bands, is the burden of adding one more band to support 600 MHz service
significantly different from the burden of adding multiple bands to
support 600 MHz operations? What is the maximum number of band plans we
should offer in this spectrum?
93. In addition to potentially increasing a device's cost, size,
and/or complexity, multiple band plans can also reduce
interoperability. For example, if a provider's license area covers only
two of the four band plans available nationwide, it might choose to
support only that subset of bands in its devices. As explained above,
one of our goals in deciding how best to license this wireless spectrum
is encouraging interoperability. Interoperability has often been
important in ensuring rapid and widespread deployment of mobile devices
in a new spectrum band. Do our proposals sufficiently encourage and
ensure interoperability in the 600 MHz band? Alternatively, should we
require interoperability by adopting a specific interoperability rule?
We seek comment on this issue.
94. As discussed above, to balance our goals of making more
wireless spectrum available by clearing different amounts of spectrum
in different areas and minimizing the burden of multiple band plans, we
propose creating ``families'' of related band plans, where the same
downlink band is available nationwide but the amount of spectrum
cleared for uplink use will differ among areas. By keeping the same
downlink spectrum nationwide, all user devices on the 600 MHz spectrum
can potentially be supported with a single receive filter in the mobile
device, thereby minimizing the costs associated with user devices and
promoting interoperability. To obtain these benefits, however, the
mobile device must be able to use a single duplexer for all the band
plans. This will not result in interference, however, because the
mobile devices will only operate where the network instructs it to
transmit.
95. Given the variation in uplink spectrum, however, base stations
will require different receive filters in different areas. We believe
that creating a band plan that requires different filters on base
stations results in fewer problems and is less costly to resolve than
requiring multiple filters in mobile devices because providers use
fewer base stations, the stations are fixed, and there is more physical
room in a base station to install multiple receive filters. We seek
comment on this proposition.
[[Page 69951]]
96. Channel 51 Early Relocation. Some have argued that we should
consider interoperability because of the experience with lower 700 MHz
A Block licensees. They further contend that exclusion zones designed
to protect broadcasting have presented significant deployment
challenges for lower 700 MHz A Block licensees. We seek comment on
these arguments and on resolving issues related to coexistence of Lower
A Block operations and channel 51 even before we commence the incentive
auction by facilitating requests for channel relocation associated with
voluntary agreements between affected parties addressing these issues.
c. Duplex Gap
97. One important parameter in determining the band plan is the
required separation between the uplink and downlink bands, referred to
as the duplex gap. We seek comment on the necessary size of the duplex
gap. In the LTE bands specified by 3GPP, the smallest duplex gap is 10
megahertz for Band 8 (880-915 MHz and 925-960 MHz bands), with gaps
ranging up to 355 megahertz for Band 4 (AWS-1). The size of the duplex
gap relative to the width of the pass band is often considered more
important than the absolute size, however, as filter roll off is
generally proportional to frequency. Other factors can affect the
appropriate duplex gap as well, such as the pass band width relative to
the center frequency of the pass band, the duplex spacing between the
transmitted and received signals, and allowances for temperature and
manufacturing variation in components. In our proposed band plan, the
duplex spacing is 90 megahertz, but we are not proposing a specific
size for the duplex gap. Instead, we seek comment on the appropriate
size of the duplex gap, and whether it should be specified as a minimum
number of megahertz, a percentage of the pass band, another metric, or
a combination of such metrics.
d. Pass Band Size
98. In our band plan proposal we have aimed to create large amounts
of contiguous spectrum in a single band, minimize fragmentation of
spectrum, and minimize proliferation of separate bands for flexible use
spectrum. We recognize that there may be technical limitations on the
maximum size of a band that can be supported, however.
99. Filters commonly used in mobile devices may have an upper limit
on the pass band size they can support. Examination of the bands
defined for LTE show the largest pass band for an FDD band is Band 3
(1710-1785 MHz and 1805-1880 MHz band), where the pass band is 4.2% of
the center frequency. Larger pass bands may be possible, however. For
example, Band 41 (2496-2690 MHz band), which is used for TDD
operations, has a pass band of 7.5%. IWPC indicates that SAW filters
using an alternative manufacturing process with Lithium and Niobium can
support pass bands of up to 6% of the pass band center frequency. See
IWPC presentation to the FCC ``IWPC Mobile RF Filter Group'' March 11,
2011 at 14, available at http://www.iwpc.org/ResearchLibrary.aspx?ArchiveID=165&Display=doc.
100. In our proposed band plan, we may reach a potential technical
limit of 4-6% of the pass band if we make 10 or more 5 megahertz blocks
available for auction. We also recognize that there may be other
technical limitations on band size, due to antennas or other
components, and seek comment on any other limiting factors. We seek
comment on any technical limitations on pass band size. Does current
filter technology limit the pass band size to no more than 4% of the
pass band center frequency, no more than 6% of the pass band center
frequency, or some other limit? Are there other limitations on pass
band size due to other components of the system? Are these hard limits
or soft limits, that is, what are the consequences of slightly
exceeding any stated limit? Are these limits likely to change by the
time the 600 MHz band is deployed, or in the future, and how should we
allow for any potential changes in configuring our band plan?
101. Even if the maximum size of a band is limited by current
technologies, we believe it is better long-term spectrum policy to
clear larger bands that can take advantage of future technology
innovations. We seek comment on this issue. We also seek comment on how
these limits may relate to the duplex gap, duplex spacing, and guard
bands. Does increasing the size of the guard bands allow support of a
larger pass band? If so, should we consider setting the minimum guard
band size relative to the pass band size? Do the relatively large
duplex gap and duplex spacing in our proposed band plan allow large
pass bands?
e. Border Issues
102. As explained below, we recognize that TV broadcast operations
in Canada and Mexico may reduce the amount of spectrum fully cleared
for wireless use. We seek comment on how to address these border
issues, particularly given the disparate timeframes for conversion to
digital television in Canada and Mexico. For example, in specific
license areas, should we place the 600 MHz uplink bands only in the
available channels in channels 38-51 where wireless broadband
operations will not be affected by remaining TV operations in the
border areas? How can downlink spectrum be maximized in the border
areas?
6. Additional Band Clearing Considerations
a. Interchangeable Blocks
103. Although we posit that creating spectrum blocks that are
interchangeable will be advantageous to wireless bidders, we also seek
comment on whether wireless bidders would prefer access to a greater
amount of spectrum, even if not all blocks are protected equally from
interference. For example, if we adopt a plan that allows for non-
nationwide clearing of broadcast television stations, only a portion of
a wireless broadband service area may be cleared in some areas because
the contour of a broadcast station and the contour of a wireless
license service area are not identical. If interchangeability is more
important than quantity, we could choose not to offer wireless
broadband licenses in these types of areas. We seek comment on whether
we should refrain from offering blocks in areas where part of the
spectrum is encumbered. If we offer only non-encumbered spectrum
blocks, however, we will be able to offer fewer blocks of spectrum for
wireless use, particularly along border areas. Alternatively, should we
offer these encumbered blocks to interested bidders? If so, how? Should
we establish a threshold (e.g., a percentage of a license area's
population or geography) for determining whether a license is
considered ``clear'' even if some portion of the license area has
incumbent operations that must be protected? If so, how would such a
concept affect the auction design? If we decide not to license certain
heavily encumbered blocks, should we make the ``cleared'' spectrum
available for unlicensed use? For example, if 90 percent of the
geographic area of a spectrum block is encumbered by broadcasters,
should we make the remaining 10 percent available for unlicensed use?
We seek comment on potential approaches to address this issue.
b. Remainder Spectrum for Unlicensed Use
104. In order to maximize the number of valuable blocks for
licensing, to improve the interference environment
[[Page 69952]]
for mobile operations, and to increase the substitutability of blocks
in the auction, we propose to add ``remainder'' spectrum to the guard
bands, which would be available for unlicensed use. The downlink and
uplink 600 MHz bands would each be organized into 5 megahertz blocks,
which can be aggregated by licensees into larger contiguous blocks as
needed. Because 5 megahertz blocks match the prevailing channelization
increments of modern cellular systems, this block size could enable a
greater quantity of usable licensed blocks in any given market as
compared to other approaches. The cleared TV broadcast stations operate
on 6 megahertz wide channels, however, and as explained above, some
spectrum from broadcasters' relinquished spectrum usage rights must
serve as guard bands. Therefore, to determine the number of wireless
spectrum blocks available for downlink and for uplink in each market,
we look at the total amount of spectrum cleared, divide that number by
2, subtract the guard band, divide by 5 (megahertz), and round down.
Because we must round down to a number divisible by 5 to create the
wireless spectrum blocks, we will have 0 to 4 megahertz of
``remainder'' spectrum in any given market for each half of the duplex
pairing. For the reasons described above, we believe that licensing in
5 megahertz increments is ideal from a technological perspective, and
we propose auctioning interchangeable blocks of equal size to allow for
enhanced substitutability among building blocks, which may give us more
flexibility in our auction design choices. Therefore, we must find an
alternative use for the ``remainder'' spectrum.
105. As discussed above, we propose a minimum of 6 megahertz guard
bands between wireless and broadcast operations. Because we may have no
``remainder'' spectrum available in some areas, we must ensure that our
proposed minimum size for guard bands is sufficient to protect against
interference between broadcast and wireless operations. As noted above,
providing additional guard band protection beyond 6 megahertz would
further improve any potential interference concerns, and therefore, we
propose to add this remainder spectrum to the guard bands. For example,
if we clear 30 megahertz for downlink operations, and the guard band
between wireless downlink and television is 6 megahertz, then the
number of spectrum blocks available is four. Thus, in that market, we
can offer four 5 megahertz blocks, and the remaining 4 megahertz of
spectrum will be added to the 6 megahertz guard band, and offered for
additional unlicensed use. Under this proposal, there could be between
6 and 10 megahertz of spectrum between the television channels and the
600 MHz uplink band in a market. In addition, there could be another 6
to 10 megahertz of spectrum between the television channels and the 600
MHz downlink band in a market. We seek comment on this approach. We
also seek comment on alternative ways to make use of the remainder
spectrum. For example, we note that it may be possible, when the
remainders total 5 megahertz or more, to apportion some or all of the
remainder spectrum to one half of the duplex pairing, e.g., the
downlink. This would increase the total number of 5 megahertz blocks
available for licensing, but would have a tendency to reduce the number
of uplink blocks and increase the asymmetry of the band plan. We seek
comment on the advantages and disadvantages of various approaches to
remainder spectrum.
7. Alternative Band Plan Approaches
106. In our proposed band plan, we have tried to balance
flexibility with certainty while maximizing the amount of spectrum we
can make available for wireless broadband services in each geographic
area. We recognize that other band plans are possible that may achieve
these goals. Below we discuss a few possible alternatives, compare them
to our lead proposal, and seek comment on these approaches. In
addition, we invite commenters to offer variations on our proposed band
plan, address the alternative band plans we discuss below, or propose
their own band plan. We also invite commenters to address whether there
are other advances in technology that would improve efficiency in the
band, and allow more flexibility in the band plan, perhaps similar to
the manner in which the development of cognitive radio and the ability
to query databases enabled the development of television white spaces
devices. Commenters should discuss and quantify the costs and benefits
of their proposed band plan, explain why their band plan better serves
the public interest and our policy goals than our lead proposal, and
discuss which proposed technical rules would need to be modified to
accommodate their proposal.
a. Down From Channel 51
107. Using an alternative approach to our lead band plan proposal,
we could clear broadcast television channels starting at channel 51 and
expand downward. Under this approach, we would organize the cleared
spectrum into an uplink portion, a downlink portion, and any necessary
guard bands. Adopting this alternative would require us to designate a
quantity of spectrum as a duplex gap between the uplink and downlink
bands, which would not be used for licensed wireless broadband
operations. As a result, this alternative band plan requires a tradeoff
between the duplex gap size and the amount of licensed spectrum.
Minimizing the duplex gap size would increase the amount of spectrum
available for licensing but could have a negative impact on mobile
performance. A wider duplex gap, conversely, could enhance mobile
performance. We anticipate that regardless of the size of the duplex
gap, some portion of the spectrum could also be available for
unlicensed operations. We seek comment on whether, with a wider duplex
gap, as with the alternative approach in which the downlink starts at
channel 36, it may be possible to leave some television operations, as
well. We seek comment on this alternative band plan proposal, and its
relative costs and benefits in making spectrum available for broadband,
including both licensed and unlicensed uses.
108. Channel 37 Services Fixed. If the existing wireless medical
telemetry and radio astronomy operations remain fixed in channel 37,
and if we clear more than 84 megahertz of spectrum, the channels above
and below channel 37 would need to be cleared under this alternative
band plan because channel 37 would be located in the downlink band. If
we decide not to move incumbent channel 37 services, then this
alternative is less advantageous than our lead proposal, which places
the downlink band against channel 37, and assumes that existing channel
37 operations will remain in that frequency band.
b. Relocating Existing Channel 37 Operations
109. As described above, section 6403(b)(4)(A)(iii) of the Spectrum
Act gives us authority to reimburse the move of incumbent operations in
channel 37, with certain constraints. Our proposed band plan does not
require us to move channel 37 operations, and instead, attempts to
benefit from allowing existing channel 37 operations to remain in that
frequency band by using channel 37 as a guard band between television
operations and mobile broadband operations. If we decide to relocate
channel 37 operations, however, should we consider other alternative
band
[[Page 69953]]
plans, which may be just as spectrum-efficient? For example, we could
consider placing the downlink band at channel 32 instead of channel 36,
which allows for symmetry between the amount of potential uplink and
downlink spectrum. We seek comment on these alternatives and the costs
and benefits associated with adopting them and in making spectrum
available for broadband, including both licensed and unlicensed uses.
c. In From Channels 51 and 21
110. Another alternative approach is to situate the 600 MHz uplink
band adjacent to the 700 MHz uplink spectrum (as in our lead proposal),
and situate the downlink band at the lower end of the broadcast
television spectrum, at channel 21. The uplink spectrum would expand
downward, and the downlink spectrum would expand upward. Similar to our
proposed band plan, this alternative allows us to keep existing channel
37 operations on that channel, because channel 37 sits in the duplex
gap. Further, like our lead band plan proposal, we would not need to
create a duplex gap, because the remaining broadcast television
operations would operate in the duplex gap. We would need to create
guard bands where the mobile broadband operations and television
operations meet, however. We would also need to determine whether such
a large pass band size would be able to be supported by one band plan.
We seek comment on this approach and the costs and benefits associated
with adopting it and in making spectrum available for broadband,
including both licensed and unlicensed uses.
d. Prioritizing Paired Spectrum
111. Our lead proposal allocates equal amounts of downlink spectrum
and possibly different amounts of uplink spectrum in each market. Such
an approach would maximize the amount of downlink spectrum available
nationwide as well as the total amount of spectrum reallocated from
television broadcasting to flexible use. In some circumstances,
however, the proposed approach might result in highly asymmetrical
markets. An alternative approach might prioritize the pairing of
spectrum nationwide rather than the amount cleared in each individual
market. Under this approach, the number of channels reallocated would
be the same in every market and the spectrum cleared would be evenly
split between paired downlink and uplink spectrum, with any residual
blocks used to create no more than one block of unpaired downlink
spectrum. Like our primary proposal, this approach would create a
uniform downlink band plan to help ensure interoperability, and
nationwide guard bands that could be used by unlicensed white space
devices, at least on a secondary basis. On the other hand, such an
approach might constrain overall spectrum recovery by limiting the
amount of flexible use spectrum to the spectrum that can be recovered
in the ``lowest common denominator'' markets. As a third possibility,
could we allow two families of paired spectrum, one nationwide and
another in less congested markets? Such an approach might increase the
total amount of spectrum reallocated for flexible use, while
prioritizing the pairing of spectrum. We seek comment on these
alternatives, including the costs and benefits of prioritizing the
pairing of spectrum versus maximizing the total number of megahertz
reallocated.
e. Designating Spectrum for TDD Use
112. We recognize that TDD technologies can also be used to provide
wireless broadband service and seek comment on whether the Commission
should allow for TDD use in the 600 MHz band. For example, should we
set aside a separate TDD-only block in our band plan or allow TDD
operations throughout the entire band? If we set aside a TDD-only
block, should it be contingent on creating a certain number of paired
FDD spectrum blocks first? What is the minimum block size (e.g., 5
megahertz, 10 megahertz) necessary for TDD operators to effectively
provide mobile broadband service? What is the ideal geographic area
license size for this type of service? If we allow for TDD operations
throughout the band, what other considerations should we take into
account in establishing block size and geographic area license size?
113. Furthermore, if we allow for TDD in the 600 MHz band, what
technical rules should we adopt to accommodate TDD technologies while
minimizing interference concerns? For example, if we allow TDD
operations, is it necessary to establish a guard band where a TDD block
adjoins an FDD block or another TDD block? If a guard band is
necessary, should we require the TDD bidder to internalize that guard
band or otherwise mitigate interference to those adjacent blocks? What
other technical issues arise from allowing TDD in the 600 MHz band? We
seek comment on this issue, and the costs and benefits of allowing for
TDD technologies in this band. Commenters are also invited to discuss
how such issues have been resolved in other countries where TDD systems
have been licensed or are expected to be deployed (e.g., India and
China).
C. Technical Rules
1. OOBE Limits
114. Under the proposed band plan, we plan to license 600 MHz
spectrum in paired 5 + 5 megahertz blocks as well as unpaired 5
megahertz downlink expansion blocks, using Economic Area licenses.
Therefore, we must consider how to address interference between
adjacent blocks within the 600 MHz band, and between 600 MHz spectrum
and adjacent bands.
115. Emission limits. The Commission has previously concluded that
attenuating transmitter out-of-band emissions (OOBE) by 43+10*log10(P)
dB, where P is the transmit power in watts, is appropriate to minimize
harmful electromagnetic interference between operators. This is
consistent with the service rules that the Commission has adopted for
other bands, including the lower 700 MHz band, that are used for
wireless broadband services. 47 CFR 27.53(g). To fully define an
emissions limit, the Commission's rules generally specify details on
how to measure the power of the emissions, such as the measurement
bandwidth. For the lower 700 MHz band, the measurement bandwidth used
to determine compliance with this limit for both mobile stations and
base stations is 100 kHz, with some modification within the first 100
kHz. 47 CFR 27.53(g). Similarly, we believe that it is reasonable to
apply this procedure to both mobile and base transmissions in the 600
MHz band.
116. Proposal. To address potential harmful electromagnetic
interference within the 600 MHz band, we propose to apply section
27.53(g) of the Commission's rules, which includes OOBE attenuation of
43+10*log10(P) dB and the associated measurement procedure, to the 600
MHz band. We seek comment on this proposal. Commenters should discuss
and quantify the costs and benefits of this proposal and any proposed
alternative approaches.
117. Interference to Adjacent Lower 700 MHz operations. The upper
end of the 600 MHz uplink band is adjacent to the lower portion of the
lower 700 MHz band, which is also being used for mobile uplink
operations. As a result, the interference environment between these two
bands will be nearly indistinguishable from interference within either
band and we believe that our proposal to adopt the lower 700 MHz OOBE
limits will protect adjacent lower 700 MHz operations.
[[Page 69954]]
118. Interference to Adjacent DTV operations. Under our proposed
band plan, the 600 MHz band will be adjacent to DTV operations on the
lower end of both the uplink and downlink bands. The interference
environment is similar to what currently exists between the lower 700
MHz band and DTV stations. It is beneficial to maintain comparable
emissions limits among commercial bands so as not to disadvantage one
band over another. In the event that a specific incidence of harmful
interference occurs, the Commission, under section 27.53(i) of its
rules, may impose higher emissions limits as a remedy. By applying the
same OOBE limits as currently exist between the lower 700 MHz band and
DTV stations, 600 MHz licensees will provide similar protection as
exists today.
119. Interference to Channel 37 Operations. Under the proposed band
plan, downlink operations would be permitted adjacent to the lower edge
of Channel 37. Depending on the amount of spectrum that broadcasters
relinquish, uplink operations from mobiles could be permitted on the
upper edge of Channel 37. Currently, DTV stations operate adjacent to
Channel 37 without any guard bands, which indicates that the OOBE and
power limitations required of DTV stations are sufficient to protect
Channel 37 services. Both the emissions and power limits that are
permitted by DTV operations under current regulations are higher than
those proposed for the 600 MHz band. Therefore, if we adopt the
proposed 600 MHz OOBE and power limits, 600 MHz services should provide
as much or more protection to Channel 37 than they currently receive
from DTV operations.
2. Power Limits
120. We propose to generally apply power limits for the 600 MHz
band that are consistent with the lower 700 MHz band. See 47 CFR
27.50(c). However, we will need to modify the lower 700 MHz rules
because the proposed band plan for the 600 MHz band has a predetermined
uplink and downlink so different power limits are applied to each band.
121. 600 MHz Downlink Operations. We propose to limit fixed and
base station power for downlink operations in non-rural areas to 1000
watts per MHz ERP for emission bandwidths less than 1 MHz and to 1000
watts per MHz ERP for emission bandwidths greater than 1 megahertz, and
to double these limits (2000 watts ERP) in rural areas. We will not
apply the power flux density requirements of section 27.55(b) to the
600 MHz service. See 47 CFR 27.55. That requirement is designed to
protect base station receivers from other high powered (50 kW) base
stations nearby. Because high powered base stations are not allowed in
the 600 MHz band, this requirement is unnecessary. We seek comment on
this proposal, including the costs and benefits of the proposal.
122. 600 MHz Uplink Operations. The upper part of the 600 MHz band
plan is designated for uplink operations and is directly adjacent to
the lower 700 MHz uplink operations. We propose to adopt the same power
limit of 3 watts ERP for both portables and mobiles that apply to the
lower 700 MHz band and prohibit fixed and base station operations,
which are allowed in the lower 700 MHz band. 47 CFR 27.50(c)(10). In
addition, as this band is intended for delivery of commercial wireless
broadband services, no provision will be made for high power control
stations used by specialized public safety applications. We seek
comment on this approach, including the costs and benefits of the
proposal.
3. Antenna Height Restrictions
123. We propose to apply the 700 MHz flexible antenna height rules,
as set forth in section 27.50(c) of the Commission's rules to the 600
MHz band. Although the existing antenna rules do not set specific
antenna height restrictions, ERP reductions will be required for base
or fixed stations whose height above average terrain (HAAT) exceeds 305
meters. In addition, other rules effectively limit antenna heights. For
example, all part 27 services are subject to section 27.56 of our
rules, which prevents antenna heights that would be a hazard to air
navigation. Also, our proposed co-channel interference rules
effectively limit antenna heights because of the limitation on field
strength at the boundary of a licensee's service area. We believe that
the general antenna height restrictions are sufficient so we are not
proposing any band-specific limitations. We seek comment on this
approach, including the costs and benefits.
4. Co-Channel Interference Among 600 MHz Systems
124. Since we propose to license the 600 MHz bands using geographic
service areas, we need to ensure that 600 MHz licensees do not cause
interference to co-channel systems operating along common geographic
borders. The 700 MHz rules address the possibility of harmful co-
channel interference between geographically adjacent licenses by
setting a field strength limit of 40 dB[mu]V/m at the edge of the
license area. See 47 CFR 27.55(a)(2). Due to the similarities between
the 700 MHz and 600 MHz spectrum, we propose that this same signal
strength limit is appropriate for the 600 MHz band. Therefore, we
propose to apply 47 CFR 27.55(a)(2) to the 600 MHz spectrum. We seek
comment on this proposal, including the associated costs and benefits.
5. Canadian and Mexican Coordination
125. Section 27.57(b) of our rules indicates that 700 MHz
operations are subject to international agreements with Mexico and
Canada. These arrangements establish 700 MHz wireless operations on a
co-primary basis with foreign television operations. The arrangements
do not however, establish criteria for the protection of wireless
services from foreign television stations. Wireless services are
essentially protected by default, given that the U.S. and Canada, and
Mexico have agreed not to authorize new television services in the 700
MHz band. We note that modification of the 700 MHz band arrangements or
the creation of new separate arrangements pertaining to the 600 MHz
spectrum will be necessary to implement 600 MHz operations in areas
along the common border and to protect these 600 MHz operations from
cross-border interference. In addition, modified domestic rules might
be necessary in order to comply with any future agreements with Canada
and Mexico regarding the use of the 600 MHz band. We seek comment on
these issues, including alternative approaches, and the costs and
benefits of any proposal to address these issues.
6. Other Technical Issues
126. There are several additional technical rules applicable to all
part 27 services, which are: equipment authorization, RF safety,
frequency stability, antennas structures; air navigation safety, and
disturbance of AM broadcast station antenna patterns. See CFR 27.51,
27.52, 27.54, 27.56, 27.63. Because the 600 MHz band will be licensed
as a part 27 service, we propose that these rules should also apply to
600 MHz licensees, including licensees who acquire their licenses
through partitioning or disaggregation. We seek comment on this
approach, including associated costs and benefits.
VI. Other Services in the UHF Band
A. Channel 37 Services
127. TV channel 37 is not used for TV broadcasting but rather is
allocated for
[[Page 69955]]
use by radio astronomy and medical telemetry equipment. TV channel 37
is situated in the spectrum such that it could affect the viability of
certain band plans for wireless broadband service that would be most
viable from a technical and economic standpoint. The Commission's
proposed band plan does not require that existing channel 37 operations
be relocated, and instead, attempts to benefit from allowing existing
channel 37 operations to remain in that frequency band by using channel
37 as a guard band between television operations and mobile broadband
operations.
1. Radio Astronomy
128. In light of the band plan proposals in the Incentive Auction
NPRM and other considerations raised in this proceeding about channel
37 operations, the Commission seeks comment on whether RAS in channel
37 should be relocated to other spectrum and, if so, to what spectrum.
In order to properly analyze this issue, the Commission needs to be
aware of all observers in channel 37. The Commission understand that
the ten VLBA sites, as well as the Green Bank and Arecibo telescopes,
are the only radio telescopes currently observing channel 37 within the
United States at this time. Additionally, we note that the Expanded
Very Large Array in New Mexico will resume observations in channel 37
in late 2012. The Commission seeks comment as to whether any other
sites within the United States currently perform or have plans to
perform RAS observations in channel 37. In addition, it seeks comment
regarding whether any foreign telescopes located near the United States
or its territories, such as the Dominion Radio Astrophysical
Observatory in Penticton, British Columbia, currently perform or have
plans to perform RAS observations in channel 37. The Commission notes
that because this band has only contained passive services and WMTS,
which does not require individual licenses in the United States or
Canada, channel 37 is not included in any cross-border agreements.
129. Because RAS applications involve observation of very low power
radiation from space, a key requirement for RAS receivers is high
sensitivity. However, this same property which enables reception of
these low signals levels also makes the receivers susceptible to
interference. The Commission asks commenters consider this issue in
addressing whether we should relocate RAS and where. It also asks
commenters to consider the various band plan options discussed in the
Incentive Auction NPRM.
130. The Commission also invites comment on whether the RAS needs
to keep a subset of the 500-700 MHz range available for RAS continuum
observations. In addition, it seeks comment on the nature of the
spectrum needed for such measurements. Because the VLBA relies on data
from multiple receive sites, does it require a single interference-
protected band throughout the entire United States? Further, as radio
astronomy relies on extremely sensitive receivers, its seeks comment on
whether a single, contiguous band is needed or RAS requirements can be
satisfied through the use of multiple small, noncontiguous bands? In
addition, it seeks comment on the cost of relocating RAS users from
channel 37 to elsewhere in the 500-700 MHz range.
131. Further, the Commission seeks comment on whether there is a
particular band within the 500-700 MHz range that would be the most
desirable for RAS use, both from a scientific and an economic
viewpoint. One alternative to the lead band plan proposal in the
Incentive Auction NPRM would shift WMTS operations to the 578-584 MHz
band (channel 32). Would this band also be desirable for RAS
operations? Alternatively, what would the advantages and disadvantages
be in relocating RAS to the lower (2-6) or upper (7-13) channels of the
VHF band? Would such a band be as useful for RAS observations? Would
relocation costs be comparable? What are the advantages and
disadvantages of reserving another 6 megahertz-wide band for RAS use,
as compared to a narrower or wider band?
132. The Commission also invites comment on any international
implications of relocating the RAS band. How would relocating RAS from
channel 37 affect foreign RAS operations, such as at the Penticton
Observatory in British Columbia? Are there any foreign radio telescopes
observing in channel 37 that would be subject to unwanted interference?
The Commission recognizes that some RAS operations require coordinated
observations with multiple telescopes in other countries. What would be
the impact, if any, on these observations if we were to reallocate the
RAS stations in channel 37? Finally, the Commission observes that any
new RAS band in the United States would require coordination to protect
it from unwanted interference from foreign sources and, if such a step
is necessary, it proposes that United States stations be subject to the
provisions of any negotiated cross-border agreement.
2. Wireless Medical Telemetry Service
133. In light of the band plan options set forth in the Incentive
Auction NPRM, the Commission seeks comment on whether to relocate WMTS
users from channel 37 and, if so, to what spectrum. Commenters should
address their band plan preference and provide details on the relative
costs and benefits of their preferred course of action. Is the ASHE
estimate for sunk investment in WMTS systems correct and what would be
the cost of relocation? To avoid unlimited increases in possible
relocation costs, should we only consider relocating WMTS systems that
were contained in the ASHE database by a date certain (e.g., the
effective date of this NPRM)? Would the funds available for
reimbursement of relocation costs, which the Spectrum Act limits to
$300 million for all channel 37 incumbents, be sufficient?
134. The Commission also seeks comment on spectrum that could
support WMTS. Specifically, it seeks comment on whether relocating WMTS
to a nearby television channel, such as channel 32, may be less
expensive than moving WMTS to more distant spectrum. It also seeks
comment on whether the WMTS systems could simply be retuned to a new
spectrum band for WMTS or whether new equipment would be required. If
retuning is possible, is it possible to retune outside of the UHF band
and if so, what would be the costs of retuning? In addition, the
Commission seeks comment on whether all WMTS operations could be
accommodated in the WMTS bands at 1395-1400 MHz and 147-1432 MHz.
135. The Commission also seeks comment on the time frame and
process for possible relocation of WMTS. First, should relocation occur
for WMTS under comparable facilities, as has been the Commission's past
practice? If so, how would the Commission verify that the facility is
comparable? If not, what standard should the Commission utilize, and
what would be the legal basis for that standard? What would be the
appropriate time frame for relocation? The Commission asks parties to
provide estimates of the time required for equipment to be available to
support any such relocation. Further, the Commission seeks comment on
the impact of relocation on WMTS users if they were given a longer time
frame for relocation, and if we were to freeze the issuance of new WMTS
registrations. If WMTS users have a sufficiently long transition, would
the cost of transition decrease because the WMTS equipment
[[Page 69956]]
will have reached the end of its useful life?
136. Finally, the Commission notes, that the United States
Department of Veterans Affairs makes extensive use of the WMTS service.
The NTIA Manual specifies that federal users of this band must follow
the same procedures as non-federal users. The Commission seeks comment
on whether, in the event that we decide to relocate channel 37
incumbents, federal users should be considered users for reimbursement
purposes.
B. Television Fixed Broadcast Auxiliary Stations, Low Power Auxiliary
Stations, and Unlicensed Wireless Microphones
1. Television Fixed Broadcast Auxiliary Stations
137. As a result of the repacking process, the amount of spectrum
in the current VHF and UHF bands available for secondary licensing of
fixed BAS operations is likely to diminish. We seek comment on whether
and how we should address the availability of UHF band spectrum for
secondary fixed BAS operations.
138. We propose to continue the licensing of fixed BAS on a
secondary basis in the spectrum that remains available for television
broadcast services nationwide. We recognize that coordinating and
operating these point-to-point links, on a secondary basis, could be
challenging in a more closely packed UHF band. Nevertheless, the number
of fixed BAS licensees in the UHF band is relatively low, and we are
unaware of any major interference problems to broadcast television
service. Fixed BAS is directly tied to the provision of broadcast
television service and competing broadcasters have successfully
coordinated this service and other BAS operations, such as Electronic
News Gathering in the 2 GHz band, for many years. We recognize that the
continued feasibility of secondary, fixed BAS--whether for new links or
for existing links that need to change frequencies to protect a
repacked television station--may depend on the outcome of the repacking
process. We invite comment on any relevant technical or operational
implications of this proposal, including to television broadcasters and
other post-auction users of the UHF band.
139. Consistent with past practice, we propose that secondary fixed
BAS stations operating in the UHF band continue to be required to cease
operating and relocate, at their own expense, to other frequency bands
or to the repacked television band when a new 600 MHz wireless
broadband licensee intends to turn on a system within interference
range of the incumbent.
140. Also consistent with past practice, we propose to require
broadcast television or new licensees to provide thirty days' notice to
all incumbent fixed BAS operations within interference range prior to
commencing operations in the vicinity. By providing notice to existing
secondary licensees that they must cease operations, this approach will
provide an opportunity to make other arrangements for service if the
licensee has not yet done so. With several other frequency bands
available to BAS, as well as the repacked television band (under our
above proposal), we anticipate that stations will be able to engineer
in and successfully coordinate BAS stations to suit their needs. We
seek comment on these proposals.
141. We do not propose to make available compensation to fixed BAS
licensees for relocating to other frequencies because BAS stations
operate on a secondary basis in the UHF band. Historically, the
Commission has not required new stations to pay for secondary stations
to relocate. Rather, the FCC generally requires secondary stations to
cease operations and relocate at their own expense when a new primary
licensee begins operation if the secondary station will interfere with
the primary licensee's operation. We also note that the Spectrum Act
does not provide for payment of any relocation costs incurred by these
secondary stations as a result of the repacking. We seek comment on our
proposal.
2. Low Power Auxiliary Stations and Unlicensed Wireless Microphones
142. The Commission seeks comment on what steps it should take, if
any, to best accommodate wireless microphone operations along with
other uses, as well as to ensure that the available spectrum is used
efficiently and effectively by wireless microphones. It seeks comment
with respect to both licensed LPAS and unlicensed operations.
143. In particular, the Commission seeks comment on the operations
of wireless microphones in the repacked spectrum that continues to be
used for broadcast television service. With less broadcast television
spectrum available after the repacking, and the possibility that two
channels may no longer be designated for wireless microphone use, are
there additional steps that we should take to promote more efficient or
effective operations of wireless microphones in this spectrum? For
instance, to make more of this limited spectrum usable for wireless
microphones, should the Commission revise the rules for operating these
devices on a co-channel basis with television stations in the UHF band
by reducing the separation distance of 113 kilometers, a requirement
established prior to the transition to digital television? Apart from
reducing the separation distances generally, are there other, more
precise methods that we should consider, such as permitting co-channel
wireless microphone use even closer to television stations through use
of a database that takes into account the particular interference
conditions at that location? If so, should the Commission require that
wireless microphone operations be registered in a database? Could this
or other measures, such as coordination, enable more intensive use by
wireless microphones of the broadcast television spectrum that is not
available for white space devices? Are there other means of promoting
more intensive use by wireless microphones of available spectrum while
protecting broadcasting service?
144. In addition to requesting comment on wireless microphone
operations in the repacked spectrum that continues to be used for
broadcasting, the Commission seeks comment on operation of wireless
microphones in the spectrum that would be established for the guard
bands under the proposals set forth in the Incentive Auction NPRM. The
band plan contemplates guard bands in which no high power operations
would be permitted, and the Commission seeks comment on the use of such
guard bands for unlicensed white space devices under the operational
rules for those devices. The Commission seeks comment on wireless
microphone operations in such guard band spectrum. To what extent could
wireless microphone operations effectively be accommodated under any of
these proposals? Have there been any technological advances that we
should consider in this regard? The Commission also requests comment on
how wireless microphone operations in the guard bands could co-exist
with other users, including unlicensed white space devices. In
particular, should wireless microphones be permitted to operate in the
guard bands so long as they use the technologies required of white
space device operations in these bands, including the ability to access
a database (in order to identify the guard bands at particular
locations) and to comply with other technical requirements, such as
whatever power and emissions limits that we establish
[[Page 69957]]
for operations in these bands? Should wireless microphone operations
only be permitted on an unlicensed basis in the guard bands, such that
they would have the same status as the other unlicensed operations in
these bands? To what extent should wireless microphone operators that
currently qualify for registration and database protection have such
protection extended to the guard bands? The Commission asks that
commenters also discuss the costs and benefits associated with adoption
of the proposals they discuss.
VII. White Space and Unlicensed Operations
145. The Commission seeks comment on proposals to enable a
substantial amount of spectrum use by unlicensed devices, a significant
portion of which use will be available on a nationwide basis. The
Commission seeks comment on these proposals, including the technical
and economic benefits and disadvantages on all relevant industries--the
unlicensed industry, the wireless industry and broadcasters--and
consumers. The Commission seeks comment on how to balance making
spectrum available for use by unlicensed devices with our central goals
in this proceeding of repurposing the maximum amount of UHF band
spectrum for flexible use while preserving a healthy, diverse broadcast
television service.
146. White Space Devices. The Commission proposes to continue to
allow the operation of white space devices in the broadcast television
spectrum on unused channels that are not repurposed for other uses
under the current rules governing white space devices in the television
bands. When spectrum is repurposed as a result of the incentive
auction, the amount of broadcast television spectrum that will continue
to be available for these white space devices may be reduced to some
extent, in different markets, depending on the amount of spectrum that
is recovered and other factors. Because unlicensed white space devices
can adjust to whatever channels are available at any given location
according to the white space database, however, the devices should be
able to adapt to any reductions or changes in the available channels.
Given that there is considerable white space available now in many
areas-more than 100 megahertz in some markets-we expect that there will
still be a substantial amount of spectrum available for use by these
devices in the remaining broadcast television channels after the
incentive auction. The Commission expects that there will continue to
be more spectrum available in areas outside of the central urban areas
of the largest markets than within those areas. The Commission seeks
comment on these views.
147. Guard Band Availability for Unlicensed Use. The Commission's
proposed 600 MHz band plan includes guard band spectrum. The Commission
proposes to make the guard band spectrum available for unlicensed white
space device use on a non-interference basis. The Commission believes
that this proposal could increase the spectrum available for unlicensed
use in the urbanized areas of major markets where there may be little
or no white space spectrum available now, spurring deployment, use and
a national market for unlicensed devices and applications. It invites
comment on this premise. It also seeks comment on its proposal to make
the guard bands available for unlicensed use, and any alternative
approaches for the guard bands.
148. The Commission also seeks comment on whether its existing
power and emission limits for white space devices in the television
bands are appropriate for unlicensed operations in the guard band
spectrum to protect licensed operations.
149. The Commission's present rules for white space devices in the
television bands utilize a database to inform devices in real time
which television channels they may operate on. Should the same process
be used to make guard band spectrum available for use by existing and/
or future white space devices? What changes would be required to
accommodate different amounts of guard band spectrum?
150. Possible Use of Channel 37. The Commission proposes to make
channel 37 available for unlicensed use, while protecting WMTS and the
Radio Astronomy Service. This proposal would increase the efficiency of
use of this spectrum while expanding the amount of spectrum available
for innovative unlicensed operations. The Commission seeks comment on
information regarding appropriate protection criteria for WMTS and the
Radio Astronomy Service.
151. Possible Availability of Channels Designated for Wireless
Microphones. The Commission invites comment as to whether it should
maintain the designation of two channels for wireless microphones
following the broadcast television spectrum incentive auction or
whether this spectrum should be made available for unlicensed use.
VIII. Auction Rules
152. The Commission proposes competitive bidding rules to govern
the reverse auction of broadcast television spectrum, and considers
changes to the Commission's general competitive bidding rules that may
be necessary or desirable to conduct the related forward auction for
new spectrum licenses.
A. Competitive Bidding Process for Reverse Auction--Part 1 New Subpart
1. Purpose
153. The Commission proposes a general framework for the reverse
auction of broadcast television spectrum. These proposed rules
ultimately will govern how the auction process unfolds for
broadcasters, i.e., what applicants need to do to participate and when;
how bids are collected, winners and incentive payments determined, and
broadcast stations repacked; and how the results of the reverse auction
for broadcasters are implemented, including disbursement of incentive
payments. Consistent with the Commission's typical approach to spectrum
license auctions, the proposed rules would provide a general framework
to guide the development--through a series of public notices with
opportunities for comment--of the detailed procedures and deadlines
needed to conduct the auction. The public notice process would allow
both the Commission and interested parties to focus and provide input
on certain details of the auction design and the auction procedures
after the rules have been established and the remaining procedural
issues are better defined. The Commission's experience with spectrum
license auctions demonstrates the value of this approach, so it
anticipates following a similar approach here.
2. Pre-Auction Application Process
154. The Commission proposes to require submission of a pre-auction
application by entities interested in participating in the reverse
auction. Information provided on the pre-auction application would
allow the Commission to evaluate whether the applicants are qualified
to participate in accordance with the auction rules. The Commission
envisions that the pre-auction application would be due on the dates
specified by public notice and would be filed electronically in a
process similar to that currently used for Commission spectrum license
auctions. The Commission seeks comment on proposed rules regarding the
contents of the pre-auction application for the reverse auction. The
Commission also invites comment on measures that it should take to
implement the statutory mandate to protect the confidentiality of
[[Page 69958]]
Commission-held data of licensees that participate in the reverse
auction.
155. Eligibility Requirements. The Commission proposes that in
order to participate in the reverse auction, a broadcast television
licensee must be a full power or a Class A television station. The
Commission proposes that a broadcast television licensee operating on a
noncommercial educational (NCE) reserved channel, as well as a licensee
operating with NCE status on a non-reserved channel, may participate.
The Commission also proposes that the relevant license must be valid
and not expired, cancelled, or revoked.
156. Applicant. Since the broadcast television ``licensee'' holds
the relevant spectrum usage rights that may be relinquished in the
reverse auction, in order to promote accountability and transparency,
the Commission proposes that the applicant identified on the pre-
auction application for the reverse auction must be the licensee. If
the Commission adopts this proposal, a corporate parent would not be
able to file one application for licenses held by different licensee
subsidiaries; however, a licensee holding multiple licenses would only
be required to file one application for all such licenses for which it
wishes to submit bids in the reverse auction. The Commission seeks
comment on this proposal and specifically asks commenters to address
whether it should permit other persons or entities, such as the
licensee's parent company or persons or entities with control over the
licensee, to be the applicant.
157. For broadcast television licensees agreeing to share a
channel, the Commission proposes that only the ``sharee(s)''--the
station(s) that would relinquish their frequencies in order to move to
the sharer's frequencies--must apply to participate in the reverse
auction. More than two stations may share a channel. Thus, although
there would be only one sharer in each channel sharing relationship,
there could be multiple sharees. Since the ``sharer'' station would not
move as a part of the channel sharing arrangement, the Commission
proposes that the sharer need not submit an application to participate
in the reverse auction unless it intends to bid to relinquish other
spectrum usage rights--for instance, depending on the available bidding
options, the sharer might bid to move from a UHF to a VHF channel, or
it might submit a contingent bid to relinquish all of its spectrum
usage rights. The Commission seeks comment on this proposal. The
Commission also asks commenters to address any costs and benefits that
would result for the auction and for the channel sharing relationship
if, in the alternative, the Commission were to require all parties to a
channel sharing agreement (i.e., the sharee(s) and the sharer) to file
pre-auction applications. Are there any other issues that the
Commission should consider regarding channel sharing agreements that
may affect who should apply to participate in the reverse auction?
158. Information and Certifications Required in Application to
Participate in Competitive Bidding. The Commission seeks comment on
what information applicants should be required to provide and what
certifications they should be required to make in the pre-auction
application regarding their qualifications to participate in the
reverse auction.
159. Based on the Commission's experience with spectrum license
auctions, it proposes that the pre-auction application request the
following information from the applicant: (1) The applicant's name and
contact information; (2) the license(s) (including station and channel
information, full power or Class A status, and NCE status) and the
associated spectrum usage rights that may be offered in the reverse
auction (including whether the applicant intends to bid to relinquish
all of its spectrum usage rights, to channel share, to move from UHF to
VHF frequencies, and/or to offer any other permissible
relinquishments); (3) any additional information required to assess the
spectrum usage rights available for the reverse auction; (4) the
identity of the individuals authorized to bid on the applicant's
behalf; (5) the applicant's ownership information as set forth in 47
CFR 1.2112(a), and, for NCE stations, information regarding the
licensee's governing board and any educational institution or
governmental entity with a controlling interest in the station, if
applicable; (6) for a channel sharing applicant, the channel the
parties intend to share and any necessary information regarding the
channel sharing agreement; (7) an exhibit identifying any bidding
agreements, bidding consortia, or other such arrangements to which the
applicant is a party, if permitted; (8) any current delinquencies on
any non-tax debt owed to any federal agency, but only if the Commission
determines in this proceeding that such information is necessary in
order to assess the licensee's eligibility to participate in the
reverse auction or if the Commission adopts a rule that would allow it
to offset incentive payments by the amount of the licensee's
outstanding delinquencies; and (9) any additional information that the
Commission may require. The Commission seeks comment on this proposal.
In particular, in lieu of requesting the ownership information set
forth in 47 CFR 1.2112(a), should the Commission require reverse
auction applicants to provide less detailed ownership information, and
if so, what information should the Commission require? Should the
Commission instead request the same ownership information that
broadcast television licensees currently provide for the purposes of
the multiple ownership rules, in which case attributable interests
would need to be disclosed but non-attributable interests, such as
certain insulated parties, would not need to be disclosed? If so,
should the Commission merely require applicants to provide updated
information to supplement existing disclosures on file with the
Commission regarding media ownership, such as the information contained
in the licensee's most recently filed Form 323 or Form 323-E Biennial
Ownership Report Form?
160. The Commission seeks comment on what information regarding
channel sharing agreements it should request in order to assess an
applicant's eligibility to participate in the reverse auction. What
information or documentation should the Commission require as a part of
the pre-auction application? Should the Commission require submission
of the channel sharing agreement with the pre-auction application?
161. The Commission also proposes and seeks comment on rules that
would require applicants to certify on the pre-auction application
that: (1) The applicant meets the statutory and regulatory requirements
for participation in the reverse auction, including any requirements
with respect to the applicant's licenses for the spectrum usage rights
offered in the reverse auction; (2) if the applicant is a Class A
television station, that it is, and will remain during the pendency of
its application(s), in compliance with the ongoing statutory
eligibility requirements to remain a Class A station; (3) for a channel
sharing applicant, that the channel sharing agreement is consistent
with all Commission rules and policies, and that the applicant accepts
any risk that the implementation of the channel sharing agreement may
not be feasible for any reason, including any conflict with
requirements for operation on the shared channel; (4) for a channel
sharing applicant, that its shared channel facilities will continue to
provide minimum coverage to its principal community of license as set
[[Page 69959]]
forth in the Commission's rules; (5) the applicant agrees that the bids
it submits in the reverse auction are irrevocable, binding offers of
the licensee; (6) the applicant agrees that it has sole responsibility
for investigating and evaluating all technical and marketplace factors
that may have a bearing on the bids it submits in the reverse auction;
and (7) the individual submitting the application and providing the
certifications is authorized to do so on behalf of the applicant. If
the person submitting the application and providing the certifications
on behalf of the applicant is not an officer, director, board member,
or a controlling interest holder, the Commission proposes to require
the applicant to submit evidence that such person has the authority to
bind the applicant.
162. The Commission proposes that all parties to any channel
sharing agreement--i.e., the sharer and the sharee(s)--be required to
make any necessary certifications with respect to the channel sharing
agreement. The Commission seeks comment on this proposal and whether
requiring all channel sharing parties to make any necessary
certifications will encourage or discourage stations from entering into
a channel sharing agreement in connection with the auction. In
addition, the Commission seeks comment on any other issues that it
should consider regarding certifications by licensees agreeing to
channel share.
163. In addition, the Spectrum Act specifies that ``a person who
has been, for reasons of national security, barred by any agency of the
Federal Government from bidding on a contract, participating in an
auction, or receiving a grant'' may not participate in a system of
competitive bidding that is required to be conducted by Title VI of the
Spectrum Act. This national security restriction applies to the
broadcast television spectrum reverse and forward auctions since Title
VI requires the Commission to conduct both auctions.
164. The Commission proposes that on the pre-auction application
for the reverse auction, the applicant must certify, under penalty of
perjury, that it and all of the related individuals and entities
required to be disclosed on the pre-auction application are not
``person[s] who [have] been, for reasons of national security, barred
by any agency of the Federal Government from bidding on a contract,
participating in an auction, or receiving a grant.'' The Commission
proposes to include an identical certification requirement on the
short-form application for participation in the forward auction. The
Commission requests comment on this proposal. For the purposes of this
certification, the Commission proposes to define ``person'' as an
individual, partnership, association, joint-stock company, trust, or
corporation. The Commission also proposes to define ``reasons of
national security'' to mean matters relating to the national defense
and foreign relations of the United States. The Commission seeks
comment on these proposed definitions. What other issues, if any,
should the Commission consider regarding this national security
restriction?
165. Procedures for Processing Pre-Auction Applications. The
Commission proposes that, similar to other auctions, if an applicant
fails to make the required certifications, the application would be
rejected, i.e., dismissed with prejudice. The Commission also proposes
that after the Commission's initial review of the pre-auction
applications, applicants would have an opportunity to cure defects
identified by the Commission, but if not corrected before the
resubmission deadline, such applications would be dismissed. With
respect to licensees whose pre-auction applications are dismissed, the
Commission seeks comment on whether it should consider such licensees
to be ``applicants'' and/or ``participants'' for the purposes of
applying its reverse auction rules. For instance, should such licensees
be considered ``applicants'' under the proposed rule prohibiting
certain communications and ``participants'' under the proposed rule
protecting confidential Commission-held data of licensees participating
in the reverse auction?
166. The Commission proposes that whenever the information
furnished in a pending pre-auction application is no longer
substantially accurate and complete in all significant respects, the
applicant must amend or modify the application as promptly as possible
and in any event within five business days. The Commission proposes
that certain minor changes would be permitted subject to a deadline
specified by public notice, but major changes to the pre-auction
application would not be permitted. Major amendments would include, but
are not limited to, changes in ownership of the applicant or the
licensee that would constitute an assignment or transfer of control.
Precluding such changes in ownership after the submission of the
application would ensure that all of the relevant parties are clearly
identified for the purposes of applying the reverse auction rules,
including the rule prohibiting certain communications. In addition,
major amendments would include changes to any of the required
certifications and the addition or removal of licenses or
authorizations identified on the pre-auction application for which the
applicant intends to submit bids. Minor amendments would include any
changes that are not major, such as correcting typographical errors and
supplying or correcting information requested by the Commission to
support the certifications made in the application. The Commission
seeks comment on these proposals.
167. In typical spectrum license auctions, the Commission releases
a public notice identifying qualified and non-qualified applicants. To
protect the confidentiality of the identities of all reverse auction
participants as required by the Spectrum Act, the Commission proposes
to notify the applicants individually as to whether they are qualified
bidders, i.e., are qualified to participate in the reverse auction. The
Commission seeks comment on this proposal. The Commission seeks comment
on additional issues that arise from its statutory obligation to
protect the confidentiality of Commission-held data of a licensee
participating in the reverse auction.
3. Two Competing Participants Required
168. The Commission will share with winning bidders in the reverse
auction a portion of the proceeds of the forward auction assigning
licenses for spectrum usage rights relinquished in the reverse auction
pursuant to section 309(j)(8)(G) of the Communications Act, as added by
section 6402. Clause (ii) of subparagraph (G) requires that ``[t]he
Commission may not enter into an agreement for a licensee to relinquish
spectrum usage rights in exchange for a share of auction proceeds * * *
unless * * * at least two competing licensees participate in the
reverse auction.'' Accordingly, the Commission proposes a rule to
incorporate this requirement into the competitive bidding rules for the
broadcast television reverse auction and seeks comment on the
parameters of such a rule. In particular, the Commission seeks comment
on what should constitute ``participation'' for these purposes. Should
the Commission consider a licensee to be a ``participant'' if it has
submitted an application to participate in the reverse auction and
after review of the application the Commission finds the applicant
qualified to bid? Alternatively, should the Commission require a
licensee to become a qualified bidder and submit a bid to be considered
a participant in the reverse auction? Similarly, the Commission seeks
comment on what constitutes ``competing'' for purposes of
[[Page 69960]]
this requirement. Is there any reason why multiple reverse auction
participants bidding for payments from the same source of funds--i.e.,
the proceeds of the forward auction--should not be considered to be
``competing''?
4. Confidentiality and Prohibition of Certain Communications
169. Confidentiality. Section 6403(a)(3) of the Spectrum Act
requires the Commission to ``take all reasonable steps necessary to
protect the confidentiality of Commission-held data of a licensee
participating in the reverse auction * * * including withholding the
identity of such licensee until the [spectrum] reassignments and
reallocations (if any) * * * become effective, as described in
subsection (f)(2).'' That subsection provides that these reassignments
and reallocations may not become effective ``until the completion'' of
both the reverse and forward auctions. Unlike previous auctions for
awarding spectrum licenses, which result in a winning bidder's
initiation of new services or expansion of existing operations,
licensees participating in the reverse auction will submit bids to exit
an ongoing business, or to make significant changes to that business
(e.g., by sharing or changing the channels on which they operate).
Section 6403(a)(3) recognizes the potential competitive sensitivities
of the information that such existing licensee bidders provide to the
Commission in this context.
170. The Commission proposes a rule to incorporate this
confidentiality requirement into the competitive bidding rules for the
broadcast television reverse auction and seeks comment on the
parameters of such a rule. For example, what types of information
should the Commission withhold from public disclosure in order to
protect the identities of licensees participating in the reverse
auction? Should the Commission protect non-identifying information
about licensees participating in the reverse auction, such as bid
amounts? What interests would be served by protecting such additional
licensee data? Alternatively, would disclosing such non-identifying
information provide benefits for the auction process?
171. Moreover, what ``reasonable steps'' should the Commission take
to protect confidentiality as required by the Spectrum Act?
Specifically, what types of procedures should the Commission implement
to safeguard confidential Commission-held licensee data in order to
satisfy section 6403(a)(3) of the Spectrum Act? Further, for how long
should the Commission take such ``reasonable steps''?
172. The statutory requirement extends until any reassignments and
reallocations become ``effective,'' and they may not become
``effective'' until the ``completion'' of both the reverse and forward
auctions. The Commission proposes that the reverse and forward auctions
will each be ``complete'' when the Commission publicly announces that
each auction, respectively, has ended. The Commission proposes that the
reassignments and reallocations will be ``effective'' when the
Commission publicly announces the results of the reverse auction,
forward auction, and repacking. These announcements may be released
sequentially or simultaneously. The Commission seeks comment on this
proposal and on any alternatives.
173. In addition, the Commission asks commenters to address the
advantages and disadvantages of extending the Commission's obligation
to take ``reasonable steps'' to protect confidential licensee data
beyond the effectiveness of any reassignments and reallocations of
broadcast television spectrum. After the statutory obligation in
section 6403(a)(3) no longer applies, would the licensee data qualify
for any exemptions from disclosure under the Freedom of Information Act
(FOIA)? Should the duration of the protection afforded to confidential
licensee data be different for participants that successfully bid to
relinquish spectrum usage rights in the reverse auction, as opposed to
participants whose bids are not accepted? Are there any other issues
the Commission should consider regarding the ``reasonable steps'' it
should take to protect confidentiality and the duration of such
protection, such as the public policy interest in transparency?
174. The Commission also requests that commenters address whether
the obligation to protect confidential Commission-held data should
apply solely to the Commission, or extend to applicants in the reverse
auction. Specifically, are there any legal or policy reasons to
prohibit an applicant from announcing publicly or privately that it is
participating in the reverse auction, or from releasing any of its
identifiable information in connection with the auction? A reverse
auction applicant may be prohibited by Commission rule from
communicating its bid contents or bidding strategies to other
applicants. Should applicants be entitled to note in the application
that their information is not deemed by them to be ``confidential'' and
that they waive any rights to protect it from disclosure? If a
licensee, permissibly or impermissibly, publicly releases information
regarding its participation in the reverse auction, the Commission
proposes that such information would no longer be ``confidential[ ] * *
* Commission-held data'' and, thus, the Commission would not be bound
to protect the already released information. In addition, should
applicants be prohibited from disclosing information regarding other
licensees' participation in the reverse auction? The Commission seeks
comment on these issues.
175. Auction participants may have legal obligations to disclose
information that the Commission may be required to keep confidential
pursuant to the Spectrum Act. For example, public companies must comply
with the disclosure requirements of the Securities and Exchange
Commission (SEC). More specifically, the SEC requires public companies
to report on Form 8-K certain material, non-public events for purposes
of shareholder disclosure. Of relevance here, the SEC requires that a
public company disclose on Form 8-K any ``Material Definitive
Agreement.'' A material definitive agreement is defined as ``an
agreement that provides for obligations that are material to and
enforceable against the registrant [i.e., the filing party], or rights
that are material to the registrant and enforceable by the registrant
against one or more other parties to the agreement, in each case
whether or not subject to conditions.'' If a public company has entered
into a material definitive agreement, it must disclose on Form 8-K both
(1) the date on which the agreement was entered into or amended, the
identity of the parties to the agreement or amendment, and a brief
description of any material relationship between the filing party or
its affiliates and any of the parties, and (2) a brief description of
the terms and conditions of the agreement or amendment that are
material to the filing party. Does this reporting requirement apply in
the context of a broadcast station participating in the reverse
auction? Would this scenario create any conflict with the Commission's
confidentiality obligations under the Spectrum Act?
176. Prohibition of certain communications. In the interests of
fairness and maximizing competition in the reverse auction process, the
Commission proposes to prohibit applicants in the reverse auction from
communicating with one another directly or indirectly regarding the
substance of their bids or bidding strategies during a time period
commencing on or after the pre-auction application deadline and ending
on a
[[Page 69961]]
date specified by public notice. Communications among applicants
concerning matters wholly unrelated to the reverse auction, such as
discussions between a broadcast affiliate and its network programming
supplier on issues unrelated to the reverse auction, would not fall
within the communications prohibition. This proposal is consistent with
the Commission's approach in spectrum license auctions. The Commission
seeks comment on this proposal, particularly with respect to the scope
of the prohibition. In particular, should the Commission limit the
prohibition to applicants within the same geographic region? If so, how
should the Commission define the relevant geographic region?
177. Also, for purposes of this prohibition, should the term
``applicant'' include all controlling interests in the entity
submitting the pre-auction application, as well as all holders of
partnership and other ownership interests and any stock interest
amounting to ten percent or more of the entity, or outstanding stock,
or outstanding voting stock of the entity submitting the pre-auction
application, and all officers and directors of that entity? For NCE
stations, should the ``applicant'' also include, where relevant, all
members of the licensee's governing board?
178. Should the Commission adopt any specific exceptions to the
communications prohibition for certain applicants in the reverse
auction? In particular, recognizing that one party may have an
attributable ownership interest in a number of different broadcast
television licensees, should auction-related communications between
applicants with attributable and/or controlling interests in one
another be exempt from the communications prohibition? Are there any
other issues regarding the ownership structure of broadcast television
licensees that the Commission should consider? Should the Commission
permit auction-related communications between applicants that have
agreements or arrangements particular to the broadcast television
industry, such as a local marketing agreement (LMA), a joint sales
agreement (JSA), a shared services agreement (SSA), a network
affiliation agreement, or another similar cooperative arrangement?
179. Instead of adopting specific exemptions for particular types
of relationships, consistent with the Commission's approach in spectrum
license auctions, should it provide a more general exception to the
proposed rule prohibiting certain communications that would allow
parties to communicate with one another so long as they have entered
into a partnership, joint venture, consortium, or other agreement,
arrangement, or understanding relating to the spectrum usage rights
being offered in the reverse auction if they have disclosed the
existence of those relationships to the Commission? Would disclosure of
such agreements to the Commission sufficiently alleviate
anticompetitive concerns, even if the Commission does not disclose the
existence of such agreements publicly or to other participants in the
reverse auction? The Commission notes that even if its competitive
bidding rules permit communications among certain reverse auction
participants during the auction, participants must also adhere to any
applicable antitrust laws. The Commission seeks comment on whether and
how any applicable antitrust laws should affect a general exception to
the prohibition of certain communications in the reverse auction.
180. In addition, how should the Commission's prohibited
communications rule address channel sharing? To alleviate collusion and
antitrust concerns related to channel sharing, should the Commission
prohibit communications among parties to a channel sharing agreement
concerning bids or bidding strategies during the time period specified
for all prohibited communications regardless of whether such parties
are ``applicants'' in the reverse auction? Should the Commission expand
or contract the applicable time period for channel sharing stations and
begin the application of the prohibition at an identified point in time
before or after the pre-auction application deadline? In the
alternative, recognizing that parties to a channel sharing agreement
may prefer to share information with one another regarding their
participation in the reverse auction, should the Commission grant an
exception to the communications prohibition for communications among
licensees agreeing to share a channel? Should channel sharing
agreements fall under a general exception for agreements relating to
spectrum usage rights offered in the reverse auction, so long as the
agreements are disclosed to the Commission? In addition, even if the
Commission determines in this proceeding that the sharer need not file
a pre-auction application, given the sharer's indirect participation in
the reverse auction through the sharee(s)' channel sharing bids, is
there any reason why the Commission should not apply the rule
prohibiting certain communications to the sharer and the sharee(s) so
that the sharer would be prohibited from communicating with other
reverse auction applicants? Should any exception for communications
among licensees agreeing to share a channel extend to a contingent
offer by the sharer to relinquish all of its spectrum usage rights? The
Commission seeks comment on these issues. The Commission also seeks
comment on antitrust laws that may impact channel sharing stations'
participation in the reverse auction, and asks commenters to address
whether and how such laws should affect its proposed rule prohibiting
certain communications.
181. The Commission also requests comment on whether to prohibit
reverse auction applicants from communicating with applicants in the
forward auction regarding the substance of their bids or bidding
strategies. If the Commission adopts this approach, what would be the
appropriate duration of the prohibition? Should the prohibition begin
on or after the pre-auction application deadline for either the reverse
or the forward auction--whichever is first--and end after both the
reverse and forward auctions are complete? Would the benefits and/or
the feasibility of prohibiting certain communications among applicants
in both the reverse and forward auctions change depending on whether
they are conducted simultaneously or sequentially? Also, to enforce
this prohibition, should the Commission require applicants in the
reverse auction to identify in their pre-auction applications any
relationships with wireless companies (for example, ownership by the
same parent company or cross-marketing agreements) since those
companies may participate in the forward auction? Should the Commission
also require applicants in the forward auction to identify in their
short-form applications any relationships with broadcast television
licensees?
182. The Commission further asks commenters to consider the
potential impact that the Commission's obligation to withhold reverse
auction participants' identities may have on its proposed
communications prohibition. In prior auctions in which the Commission
sought to limit the disclosure of certain bidding-related information,
the Commission provided each applicant a list of the other applicants
with which they were not permitted to cooperate, collaborate, or
communicate--including discussing
[[Page 69962]]
bids, bidding strategies, or post-auction market structure. Since
section 6403(a)(3) of the Spectrum Act requires the Commission to take
reasonable steps to keep the identities of broadcast television
licensees participating in the reverse auction confidential, how can
the Commission notify an applicant of the other applicants with which
it may not communicate without releasing the names or other identifying
information about the other applicants? To apply a prohibition against
communications while complying with the confidentiality requirements of
the statute, should the Commission prohibit all applicants in the
reverse auction process from discussing their bids and bidding
strategies with any broadcast television licensee, regardless of
whether the licensee is participating in the auction? Would it be
possible to limit such a ``blanket'' prohibition to broadcast
television licensees within the same geographic region, and if so, how
should the Commission define the relevant geographic region? The
Commission welcomes any insights commenters may have on ways it can
provide applicants the information they need to comply with the
communications prohibition without releasing any confidential
Commission-held data concerning licensees participating in the auction.
5. Bidding Process Options
183. The Incentive Auction NPRM proposes rules that would enable
the Commission to select among procedural options when finalizing the
auction design and related processes.
184. Reverse Auction Design Options. The Commission proposes a rule
that provides for the establishment of specific auction procedures
governing bid collection, assignment of winning bids, and the
determination of incentive payment amounts in the reverse auction. The
reverse auction may use one or more rounds of bidding and/or contingent
stages of bidding. The procedures may incorporate bids or offers that
simply specify a price for an item, that indicate demand for an item at
a specified price, or that are more complex. The Commission may
determine the assignment of winning bids in the reverse auction based
on bid amounts and a variety of other factors, including but not
limited to the feasibility of assigning broadcast television channels
to licensees retaining spectrum usage rights, as well as the bids
submitted in and/or the results of the forward auction. The Commission
also proposes a rule regarding procedures to determine the incentive
payments that winning bidders would receive. These proposed rules would
enable the development of procedures for a specific auction design that
is consistent with the various technical and policy requirements of the
reverse auction as well as sound economic principles and practice and
the needs of the Commission and the bidders. The Commission proposes
that it may use real time bidding in all electronic auction designs.
The Commission seeks comment on these proposals. Are there any
additional auction design considerations that the Commission should
take into account for the reverse auction?
185. Sequencing. The Spectrum Act does not require the reverse and
forward auctions to occur in any particular order, and section 6403
expressly allows (but does not require) the broadcast television
reverse and forward auctions to occur simultaneously. The Commission
proposes a rule that enables the sequence of the reverse and forward
auctions to be determined closer in time to the actual bidding. The
Commission seeks comment on this proposal.
186. Reserve Price. The competitive bidding rules applicable to
typical spectrum license auctions specify that the Commission may
establish a reserve price or prices, either disclosed or undisclosed,
below which a license or licenses subject to auction will not be
awarded. The forward auction, as a spectrum license auction, would be
subject to this rule. Similarly, the Commission proposes that it may
establish a reserve price or prices for the reverse auction, either
disclosed or undisclosed, above which bids to relinquish spectrum usage
rights would not win in the reverse auction. The Commission proposes
that the reserve price or prices for the reverse auction may be
established for spectrum usage rights and/or licenses individually, in
combination, or in the aggregate. The Commission seeks comment on the
reserve price rule proposed for the reverse auction, and the Commission
requests input on the factors that it should consider when setting a
reserve price or prices for the reverse and forward auctions.
187. One factor that the Commission would consider when setting a
reserve price or prices for the reverse and forward auctions would be
the statutory minimum proceeds requirement. The Spectrum Act requires
that the forward auction must yield proceeds greater than the sum of
the following: (1) The total amount of compensation that the Commission
must pay successful bidders in the reverse auction under section
6403(a)(1); (2) the cost of administering the broadcast television
spectrum incentive auction, an amount which the Commission is required
to retain under section 6403(c)(2)(C) and 47 USC 309(j)(8)(B); and (3)
the estimated amount of the relocation cost reimbursements that the
Commission is required to pay to broadcast television licensees and
MVPDs under section 6403(b)(4)(A). In addition, section 6413
anticipates that proceeds from the forward auction will be available
for distribution into the Public Safety Trust Fund. Are there any other
factors that the Commission should consider when setting a reserve
price or prices for the reverse and forward auctions?
188. Opening Bids and Bidding Increments. The Commission proposes a
rule providing for the use of maximum or minimum bid increments in
dollar or percentage terms to be established before or during the
reverse auction, as well as maximum or minimum opening bids. The
Commission requests comment on these proposals and specifically asks
commenters to address what factors should influence any maximum or
minimum opening bids and bid increments.
189. Stopping Rules. The Commission proposes a rule providing for
stopping procedures to be established before or during the reverse
auction in order to terminate the auction within a reasonable time and
in accordance with the goals, statutory requirements, and rules for the
auction, including the reserve price or prices. The stopping rule would
thereby permit the Commission to adopt criteria to determine, prior to
terminating the auction, whether such requirements have been met. The
Commission seeks comment on this proposal.
190. Activity Requirement. In the event the Commission uses a
multiple round competitive bidding design, the Commission proposes a
rule providing for activity procedures that would require a minimum
amount of bidding activity during the reverse auction. The Commission
requests input on issues that may affect the use of activity rules in
the reverse auction context.
191. Auction Delay, Suspension, or Cancellation. The Commission
proposes that, by public notice or by announcement during the auction,
it may delay, suspend, or cancel the reverse auction in the event of
natural disaster, technical obstacle, network disruption,
administrative or weather necessity, evidence of an auction security
breach or unlawful bidding activity, or for any other reason that
affects the fair and efficient conduct of competitive bidding. The
Commission further proposes that, in its sole
[[Page 69963]]
discretion, it could elect to resume the auction starting from the
beginning of the current or some previous round, or cancel the auction
in its entirety. Network interruption could cause the Commission to
delay or suspend the auction. The Commission requests comment on this
proposal.
6. Post-Auction Processing
192. The Commission seeks comment here on each step of the post-
auction process. To the extent commenters disagree with a particular
aspect of the proposed process, the Commission asks them to identify
that with specificity, propose an alternative, and address any
associated costs and benefits.
193. Commission Notices. Upon the conclusion of spectrum license
auctions, the Commission typically issues a public notice declaring the
bidding closed and identifying the winning bidders. The Commission
proposes to do so for the reverse auction, as well; however it notes
that the timing and the permissible contents of such public notice may
depend on the conduct of the forward auction and how the Commission
applies the statutory confidentiality restriction. The Commission
invites comment on this proposal and asks commenters to address whether
there are any other issues it should consider with respect to notifying
auction participants and the public of the reverse auction results.
194. Binding Obligations. The Commission proposes that all bids
submitted in the reverse auction are irrevocable, binding offers to
relinquish spectrum usage rights. As a result, if a participant's bid
is accepted in the reverse auction, the spectrum usage rights offered
in the bid would be relinquished by a Commission-imposed deadline. The
Commission seeks comment on this proposal.
195. Post-Auction Information Submittals. The Commission proposes
to require all winning bidders to submit additional information to
facilitate incentive payments, such as wiring instructions or other
bank account information necessary to disburse funds to winning
bidders. The Commission envisions that the information would be
submitted on standardized incentive payment forms. The Commission seeks
comment on this proposal.
196. The Commission further asks that commenters address the
appropriate deadlines for filing post-auction submittals. The
Commission also seeks comment on the procedures that it should apply to
a winning bidder that fails to submit the required post-auction
information by the established deadlines.
197. Incentive Payments/Portion of Proceeds Shared with Incumbent
Volunteers. In accordance with section 309(j)(8)(G)(i) of the
Communications Act, the Commission will share with successful bidders
that voluntarily relinquish licensed spectrum usage rights a portion of
the forward auction proceeds ``based on the value of their relinquished
rights as determined in [a] reverse auction.'' Section 6403(c) of the
Spectrum Act provides that the amount of the proceeds that the
Commission will share with a broadcast television licensee will not be
less than the amount of the licensee's winning bid in the reverse
auction. The Commission proposes to incorporate these statutory
requirements into the competitive bidding rules for the reverse
auction. The Commission seeks comment on this proposal.
198. The Commission proposes that generally, incentive payments
would be distributed directly to the applicant. Elsewhere the
Commission proposes that the applicant must be the licensee. The
Commission seeks comment as to whether, even if it determines in this
proceeding that the applicant may be an entity other than the licensee,
the incentive payment should be distributed only to the licensee. In
addition, the Commission proposes that for channel sharing bids, the
applicant would be the sharee since the sharee would relinquish its
frequencies in order to share a channel with the sharer. The Commission
proposes that, even if it determines in this proceeding that both
sharers and sharees should file applications and/or certain
certifications prior to the reverse auction, the incentive payment
would be distributed directly to the sharees. The Commission
anticipates that the sharee(s) may choose to share the proceeds with
the sharer based upon the contractual arrangements in their channel
sharing agreement. Would this proposal affect a sharer's decision to
participate in the reverse auction? Are there any other issues that the
Commission should consider regarding the appropriate recipients of
incentive payments for winning bids?
199. The Commission also seeks comment on the timing of the
incentive payments. The only deadline in the Spectrum Act concerning
payments to broadcast television licensees is the requirement in
section 6403(b)(4)(D) that the Commission pay relocation costs within
three years of the completion of the forward auction. This statutory
deadline does not apply to incentive payments made to winning bidders
in the reverse auction. Should the Commission identify a date by which
it should make all reasonable efforts to complete all incentive
payments? If so, what would be an appropriate goal? Should incentive
payments be distributed before, on, or after the date upon which the
licensee relinquishes its spectrum usage rights? What impact, if any,
would the timing of the incentive payments have on a broadcast
television licensee's decision to participate in the reverse auction?
200. Typically, entities that are currently delinquent on any non-
tax debt owed to any federal agency are not permitted to participate in
spectrum license auctions. In addition, the Commission's red light
procedures require that action on an application be withheld until full
payment is made on any non-tax delinquent debt owed to the Commission.
Given that one of the Commission's goals is to encourage widespread
participation in the reverse auction by broadcast television licensees,
the Commission seeks comment on whether it should add an exception to
its red light procedures that would allow entities currently owing non-
tax delinquent debt to the Commission or other federal agencies to
participate in the reverse auction. If the Commission adopts this
exception, it requests comment as to whether it should deduct the
amount of any such delinquent debts from the entities' incentive
payments and hold such funds in escrow pending the outcome of any such
delinquency proceedings and/or forward those funds to the appropriate
agencies for collection.
B. Competitive Bidding Process for Forward Auction--Modifications to
Part 1 Subpart Q
201. The Commission considers changes to the Commission's general
competitive bidding rules that may be necessary or desirable to conduct
a forward auction for new licenses to use broadcast television spectrum
made available for flexible use through the incentive auction process.
The Commission proposes that those general competitive bidding rules
would apply to resolve any mutually exclusive applications received for
such licenses. The Commission's competitive bidding rules provide a
framework from which it develops final procedures for the particular
competitive bidding processes that it conducts. Accordingly, the
Commission considers changes that might be necessary with respect to
particular licenses likely to be made available through the broadcast
television spectrum incentive auction process. The Commission notes
that any changes made to its general competitive bidding rules in other
Commission
[[Page 69964]]
proceedings would apply to the forward auction for new licenses made
available through the incentive auction process.
1. Purpose
202. The Commission has been authorized to conduct competitive
bidding to resolve mutually exclusive applications for certain types of
licenses since 1993. Accordingly, the Commission has developed a
framework of rules to facilitate the auctions that it has held to date.
The Commission's new statutory authority to conduct incentive auctions
introduces a new dimension to the competitive bidding process. The
Commission proposes revisions to the existing competitive bidding rules
to take into account that the spectrum covered by the licenses is the
subject of the broadcast television spectrum incentive auction process.
In addition, the Commission seeks comment on whether further rule
changes may be required.
2. Applications Subject to Competitive Bidding
203. The Communications Act, as amended, mandates that the
Commission use competitive bidding to resolve mutually exclusive
applications for licenses, subject to exceptions specified in the
statute. To date, the Commission has considered two or more parties
seeking to bid for a particular license to present mutually exclusive
applications for the license, irrespective of whether each party
subsequently bids for the license. Where only one party seeks a
particular license offered in competitive bidding, that license will be
removed from the competitive bidding process and the Commission will
consider that party's non-mutually exclusive application for the
license through a process separate from the competitive bidding. This
has worked well with respect to defined licenses that have parameters
such as frequency and geography defined apart from and in advance of
competitive bidding.
204. The Commission seeks comment on how to apply the requirement
of mutual exclusivity in the context of the broadcast television
spectrum forward auction. Specifically, if the spectrum to be offered
in the forward auction consists of generic (non-frequency-specific)
blocks, how should the Commission determine whether mutual exclusivity
exists? In addition, the Commission asks commenters to address whether
applications to participate in the reverse and forward auctions are
``mutually exclusive applications'' for ``initial license[s]'' since
the reverse and forward auction applicants will submit bids relating to
mutually exclusive spectrum usage rights (i.e., the spectrum currently
used by broadcast television licensees). The Commission takes this
opportunity to delete an outdated rule, 47 CFR 1.2102(c), that lists
services that under current law are now subject to competitive bidding
but previously were exempt consistent with prior law.
3. Bidding Credits
205. Section 309(j)(4) of the Communications Act requires that when
the Commission prescribes regulations to establish a competitive
bidding methodology for the grant of licenses through the use of
competitive bidding, it must ``ensure that small businesses, rural
telephone companies, and businesses owned by members of minority groups
and women are given the opportunity to participate in the provision of
spectrum-based services.'' In addition, section 309(j)(3)(B) of the Act
provides that in establishing eligibility criteria and bidding
methodologies, the Commission shall promote ``economic opportunity and
competition * * * by avoiding excessive concentration of licenses and
by disseminating licenses among a wide variety of applicants, including
small businesses, rural telephone companies, and businesses owned by
members of minority groups and women.''
206. In 1995 the Supreme Court decided Adarand Constructors, Inc.
v. Pe[ntilde]a, 515 U.S. 200 (1995), in which it held that any federal
program wherein the ``government treats any person unequally because of
his or her race'' must satisfy the ``strict scrutiny'' constitutional
standard of review. In response to the Court's holding, the Commission
decided to refrain from providing bidding credits to women- and/or
minority-owned businesses until it developed a record that would
provide the evidentiary support necessary to withstand these elevated
standards of review. The Commission has noted that minority- and women-
owned businesses that qualify as small businesses may take advantage of
the provisions the Commission has adopted for small businesses.
207. The Commission defines eligibility requirements for small
businesses on a service-specific basis, taking into account the capital
requirements and other characteristics of each particular service in
establishing the appropriate threshold. In light of the similarities
with wireless licenses already assigned in the 700 MHz band, the
Commission proposes to adopt here the same small business size
standards the Commission adopted for 700 MHz. Accordingly, the
Commission proposes to define a small business as an entity with
average annual gross revenues for the preceding three years not
exceeding $40 million, and a very small business as an entity with
average annual gross revenues for the preceding three years not
exceeding $15 million. The Commission will coordinate these proposed
small business size standards with the United States Small Business
Administration. The Commission also proposes to provide small
businesses with a bidding credit of 15 percent and very small
businesses with a bidding credit of 25 percent. The bidding credits the
Commission proposes here are those set forth in the standardized
schedule in Part 1 of the Commission's rules. The Commission seeks
comment on the use of these standards and associated bidding credits
for applicants to be licensed in the forward auction for new flexible
use licenses in the reallocated broadcast television spectrum, with
particular focus on the appropriate definitions of small and very small
businesses as they relate to the size of the geographic area to be
covered and the spectrum allocated to each license. The Commission
requests that commenters address the expected capital requirements for
services in these bands and other characteristics of the service. The
Commission invites commenters to use comparisons with other services
for which the Commission has already established auction procedures as
a basis for their comments regarding the appropriate small business
size standards.
208. The Commission also seeks comment on whether the small
business provisions it proposes are sufficient to promote participation
by businesses owned by minorities and women, as well as rural telephone
companies. To the extent that commenters propose additional provisions
to ensure participation by minority-owned or women-owned businesses,
they should address how such provisions should be crafted to meet the
relevant standards of judicial review.
209. In addition, the Commission notes that under its Part 1 rules,
a winning bidder for a market will be eligible to receive a bidding
credit for serving a qualifying tribal land within that market,
provided that it complies with the applicable competitive bidding
rules. The Commission currently has under consideration various
provisions and policies intended to promote greater use of spectrum
over tribal lands. The Commission proposes to extend any rules and
policies adopted in that proceeding to any licenses that may be issued
through competitive bidding in
[[Page 69965]]
the forward auction. The Commission seeks comment on this proposal.
4. Competitive Bidding Design Options
210. The Commission's current rules list types of auction designs
from which the Commission may choose when conducting competitive
bidding for spectrum licenses. These options include sequential and
simultaneous auctions, single and multiple round auctions, and auctions
with combinatorial bidding. Since the Commission's Part 1 competitive
bidding rules were originally adopted, auction design has evolved and
continues to evolve in new directions, sometimes combining several of
these listed auction design elements and sometimes utilizing different
elements.
211. The Commission proposes to revise the current list of auction
design options set forth in 47 CFR 1.2103. In particular, the
Commission proposes a rule that provides for the establishment of
specific auction procedures governing bid collection, assignment of
winning bids, and the determination of payment amounts in spectrum
license auctions. Such auctions may use one or more rounds of bidding
and/or contingent stages of bidding; and may incorporate bids or offers
that simply specify a price for an item, that indicate demand for an
item at a specified price, or that are more complex. The Commission may
determine the assignment of winning bids based on bid amounts and a
variety of other factors, including but not limited to bids submitted
in and/or the results of a separate competitive bidding process, such
as an auction to establish incentive payments for relinquishment of
spectrum usage rights. The Commission anticipates that procedures
established to implement these broad auction design elements would take
into account sound economic principles and practice and the needs of
the Commission and the bidders. The Commission seeks comment on this
proposal to amend 47 CFR 1.2103. In light of the Commission's authority
to conduct the broadcast television spectrum incentive auction, are
there any additional auction design considerations that it should take
into account for the forward auction?
5. Competitive Bidding Mechanisms
212. 47 CFR 1.2104 sets forth various mechanisms that can be used
in connection with any system of competitive bidding for Commission
licenses. For example, the rules enable the Commission to determine how
to sequence or group the licenses offered; whether to utilize reserve
prices, minimum opening bids and minimum or maximum bid increments;
whether to establish stopping or activity rules; and how to determine
payments required in the event of bid withdrawal, default, or
disqualification. The Commission notes, however, that 47 CFR 1.2104
does not attempt to list exhaustively all potential aspects of the
Commission's procedures for competitive bidding.
213. The Commission proposes to amend its current stopping rule
contained in 47 CFR 1.2104 so that it would permit the Commission to
establish stopping rules before or during multiple round auctions in
order to terminate the auctions not only within a reasonable time, but
also in accordance with the goals, statutory requirements, and rules
for the auction, including the reserve price or prices. The stopping
rule would thereby allow the Commission to adopt criteria to determine,
prior to terminating the auction, whether such requirements have been
met. The Commission seeks comment on this proposal and on any
alternatives.
214. The Commission also seeks comment on whether it should make
any other revisions to the competitive bidding mechanisms listed in 47
CFR 1.2104 in order to ensure compatibility with the requirements for
the broadcast television spectrum forward auction. The Commission also
asks commenters whether it should add any new mechanisms to the rule to
facilitate the conduct of the forward auction.
6. Revisions to Other Part 1 Competitive Bidding Rules
215. The Commission's existing competitive bidding rules also
establish additional procedures regarding the competitive bidding
process. More specifically, the Commission's existing rules address
applications to participate in competitive bidding, communications
among applicants to participate, upfront payments from competitive
bidding participants, down and final payments by winning bidders, and
applications for licenses by winning bidders, as well as the processing
of such applications and default by and disqualification of winning
bidders. The Commission seeks comment on whether these existing rules
require any revisions in connection with the conduct of the broadcast
television spectrum forward auction.
216. The Commission's existing rules prohibit applicants for
licenses in any of the same geographic areas from cooperating or
communicating with one another regarding the substance of their bids or
bidding strategies during the competitive bidding process unless they
have notified the Commission that they are members of a bidding
consortium or other joint bidding arrangement. This rule seeks to
prevent competing parties from reaching agreements that could reduce
the competition in the auction. The Commission seeks comment on how to
determine which parties are ``competing'' in the forward auction for
the purpose of enforcing the communications prohibition, particularly
if the spectrum licenses offered in the forward auction are generic
blocks.
217. The Commission's existing rules also include various
certifications that a party must make in any application to participate
in competitive bidding. The Commission proposes that on the short-form
application for the forward auction, the applicant must certify, under
penalty of perjury, that it and all of the related individuals and
entities required to be disclosed on the short-form application are not
``person[s] who [have] been, for reasons of national security, barred
by any agency of the Federal Government from bidding on a contract,
participating in an auction, or receiving a grant.'' As with other
required certifications, failure to include the required certification
by the applicable filing deadline would render the application
unacceptable for filing, and the application would be dismissed with
prejudice. The Commission seeks comment on this proposal.
218. Finally, the Commission invites commenters to address the
potential regulatory impact of the proposed rules. In light of
Congress's mandate to conduct a broadcast television spectrum incentive
auction, the Commission asks that commenters address the cost
effectiveness of the Commission's proposals and their own, both in
relative and absolute terms. The Commission also asks that commenters
be as detailed as possible with respect to claims based on any costs
resulting from a proposal, and take into account any costs relative to
the entire effect of the incentive auction, both on the party incurring
the cost and as a whole.
IX. Post-Auction Issues
1. License Modification Procedures
a. Application Filing Requirements and Channel Substitution Opportunity
219. Section 316 of the Communications Act authorizes the
Commission to modify any broadcast television station license in order
to promote the public interest, convenience and necessity, and the
Spectrum Act makes the right of a licensee to protest a proposed order
of modification of its license under section 316 inapplicable in the
case of a
[[Page 69966]]
modification under section 6403. The Commission proposes that once the
reverse and forward auctions are complete and the repacking becomes
effective, all stations that are reassigned to new channels would be
required to file minor change applications for construction permits
using FCC Forms 301-DTV, 301-CA or 340-DTV, with the exception of
winning channel sharing bidders, who would be required to file only if
their ``sharer'' channel--the channel to which they propose to move
once they relinquish their spectrum usage rights--is reassigned in the
repacking process. The Commission proposes a simplified, one-step
process for implementing the post-auction and post-repacking channel
changes. Rather than require stations to go through a prolonged two-
step process of first amending the DTV Table of Allotments and then
filing an application for its repacked facilities, the Commission is
proposing simply to allow stations to file either a license application
(for stations where no technical changes are proposed such as channel
sharing) or a minor change application. The Commission proposes to
expedite the processing of ``check list'' type applications that
certify compliance with the technical rules and no substantial changes
to their modified facilities. The streamlined procedures are meant to
expedite the post auction licensing and to ensure a smooth post-auction
transition and recovery of channels. The Commission anticipates that
some stations receiving new channel assignments may wish to change
their channels, and proposes that as soon as the staff has
substantially completed its processing of the minor change applications
required under the proposal above, the Commission will announce an
opportunity for stations to request a substitute channel by filing an
application to modify their construction permits, provided that they
are able to identify an available channel. The Commission seeks comment
on which licensees should be eligible for the proposed channel
substitution opportunity. The Commission also seeks comment on
appropriate procedures for the proposed channel substitution
opportunity. Because implementation of a channel sharing arrangement
does not involve construction of a new facility, the Commission
proposes that channel sharing stations simply be required to file
license applications (FCC Forms 302-DTV or 302-CA) for the shared
facility upon commencement of shared operations. If a station that has
agreed to share its channel with a winning channel sharing bidder is
reassigned to a new channel, the Commission proposes to require the
sharing stations to file license applications to share the original,
pre-auction channel until their new channel facility is constructed.
The Incentive Auctions NPRM seeks comment on these proposed procedures.
b. Construction Deadline
220. In the Incentive Auction NPRM, the Commission seeks comment on
the amount of time that stations would need to transition to their
repacked channels. The Commission recognizes the need to recover
channels from the auction to allow their use by new wireless entities
but also that stations would need various amounts of time to modify
their facilities to operate on their repacked channels depending upon
the degree of changes needed. The Commission invites comment on whether
to establish a single deadline for the completion of the transition.
Under this proposal, winning license termination bidders would be
required to cease broadcasting, and stations that remain on the air
would be required to transition to any new channel assignments by a
date certain after the completion of the reverse and forward auctions
and the effective date of the repacking. The Commission recognizes that
some stations may need additional time to complete their facilities.
Would 18 months be a reasonable transition deadline? Should the
deadline instead be tied to individual stations' authorized
construction periods? Should the three-year deadline for reimbursement
of relocation costs imposed by the Spectrum Act be factored in, and if
so, how? Commenters should explain the basis for their proposed
deadlines, and address the potential costs and benefits associated with
them. The Commission also seeks comment on creative approaches to the
logistical challenges presented by the transition. Should a phased
transition timetable be adopted, establishing different transition
deadlines according to region (in light of weather/seasonal issues),
individual station circumstances (e.g., the nature of the station
modification involved), and/or other factors? Should the Commission
establish earlier deadlines for winning license termination bidders,
winning UHF to VHF bidders, and winning channel sharing licensees.
Would it be reasonable to establish an earlier deadline for winning
license termination bidders because they need not modify technical
facilities in order to continue broadcasting? 326. Similarly, would it
be reasonable to establish earlier deadlines for other winning reverse
auction bidders because they will have access to shared auction
proceeds to help fund any necessary technical modifications and, with
regard to winning channel sharing bidders, may have to make less
complicated technical changes? Would such stations be in a meaningfully
different position from stations that elect to request advance payment
of their estimated relocation costs for purposes of completing their
transitions? The Commission also seeks comment on appropriate measures
to provide regulatory flexibility for broadcasters to complete the
transition. Regardless of the criteria adopted for considering requests
for additional time to construct, the Commission seeks comment on
whether to limit all extensions to a period of not more than six months
from grant of the extension.
2. Consumer Education
221. In order to inform the public of the transition that will
occur following the conclusion of the incentive auction and
implementation of repacking, the Commission seeks comment on the types
of consumer education that stations should perform. The Commission
cites the need to notify viewers of channel changes and changes to
station facilities that might result in a loss of service. The
Commission seeks comment on whether to require stations that are going
to cease broadcasting or transition to new channels as a result of the
broadcast television spectrum incentive auction to air viewer
notifications, as well as the form any such notifications should be
required to take and when they should be aired. Comments also are
sought on the costs and benefits of consumer education requirements.
3. Notice to MVPDs
222. The Commission seeks comment on whether to require stations
that receive new channel assignments or cease broadcasting as a result
of the broadcast television spectrum incentive auction to provide
notice to affected multichannel video programming distributors (MVPDs)
of channel changes and other technical changes that could affect
carriage. Specifically, the Commission seeks comment on whether to
require such notice, what information should be provided, and what form
it should take. Would a simple letter notification to the affected
MVPDs be sufficient? The Commission also seeks comment on a time frame
for any such notice in order to provide MVPDs with a reasonable
opportunity to prepare for any necessary carriage or technical changes
and, should they chose to do so, to provide notice to their
[[Page 69967]]
subscribers. Alternatively, would the announcement by the Commission of
the reverse auction winners and newly repacked channel assignments
provide sufficient notice to MVPDs? The Commisison asks that commenters
address the relative costs and benefits of any such notice
requirements.
B. Payment of Relocation Costs
1. Payment of Eligible Broadcaster Costs
223. Eligibility. The Commission interprets the reimbursement
mandate to apply only to full power and Class A television licensees
that are involuntarily assigned to new channels in the repacking
process; and it does not interpret it to require reimbursement of
winning reverse auction bidders. The Commission seeks comment on this
interpretation.
224. Election of Estimated or Actual Cost Approach. The Commission
proposes to allow broadcasters to elect reimbursement of their eligible
relocation costs based on either their estimated costs or their actual,
out-of-pocket expenditures. Stations choosing to receive reimbursement
based on the estimated cost approach would receive their reimbursement
through an advance payment, while stations choosing reimbursement based
on actual costs would receive reimbursement only after paying and
documenting their costs.
225. Under our proposed approach, eligible television licensees
that are involuntarily assigned to new channels in the repacking
process could elect to request an advance payment based upon a
predetermined amount to cover their relocation expenses. The Commission
seeks comment on how to estimate relocation costs under the proposed
approach. Should the estimated relocation costs be the same for all
eligible stations, or should we establish tiers of fixed rates based on
specified criteria such as the rank of the market to which the
reassigned station is licensed, the type of channel change (e.g.,
within the UHF band, within the high VHF band, or within the low VHF
band), and/or the extent of the technical modifications involved? The
Commission also seeks comment on whether, under an estimated cost
approach, the reimbursement amounts should differ depending on whether
the broadcast licensee is a full power station operating under the Part
73 technical rules or a Class A station operating under the Part 74
technical rules. Finally, the Commission seeks comment on whether to
require a station receiving an advance payment to report on whether
they spent all of their reimbursement funds and to promptly return any
unused funds.
226. Stations also could elect to be reimbursed based upon their
actual costs instead of their estimated costs. For stations that elect
to be reimbursed based on actual costs, the Commission proposes to
require documentation of all expenses. The Commission invites comment
on this proposed approach, including the potential costs and benefits
associated with it.
227. Alternatively, the Commission invites comment on whether to
require all broadcasters to demonstrate their relocation costs before
receiving reimbursement. Would such an approach necessarily result in a
more efficient use of the TV Broadcaster Relocation Fund? Would any
such benefits be offset by the administrative burdens associated with
preparation and review of such showings? How would the Commission meet
the statutory three-year deadline under such an approach? If the
Commission adopts such an approach, should it also cap reimbursements
and, if so, how should it determine the appropriate caps? Should it
provide reimbursement in excess of the cap upon an appropriate showing?
The Commission seeks comment on these issues, as well as the
appropriate procedures to use for documenting costs.
228. Determination of Eligible Broadcaster Costs. Regardless of the
reimbursement approach it adopts, the Commission invites comment on the
types of relocation costs that stations are likely to incur, and how to
determine whether costs are ``reasonable'' for purposes of the
reimbursement mandate. What types of ``hard'' and ``soft'' costs are
stations likely to incur to effectuate channel changes, and to what
extent should such costs be eligible for reimbursement? What types of
relocation costs did stations incur in the digital television
transition? Is it reasonable to expect that stations assigned to new
channels in the repacking process would incur similar expenses? In the
800 MHz rebanding program, the Commission adopted a ``Minimum Necessary
Costs Standard,'' and limited reimbursement to the ``minimum cost
necessary to accomplish rebanding in a reasonable, prudent, and timely
manner'' in order to provide facilities comparable to those presently
in use, clarifying that this did not mean the absolute lowest cost
under any circumstances. The Commission seeks comment on whether to
adopt a similar standard in this proceeding. Under such a standard,
licensees would be able to recover only costs that are reasonable,
prudent and the minimum necessary to provide facilities and services
comparable to those presently in use. The Commission also seeks comment
on whether to permit licensees to request reimbursement for facility
upgrades made while effectuating the channel changes. Some stations may
not be able to replace older, legacy equipment and may be required to
obtain upgraded or more expensive equipment in order to move to their
new channels. Would permitting reimbursement of such equipment costs
comport with the Spectrum Act mandate to reimburse only ``reasonable''
costs? The Commission also seeks comment on the point at which an
upgrade would exceed the Spectrum Act mandate of ``reasonable'' and
thus not be eligible for reimbursement.
229. The Spectrum Act prohibits reimbursements for ``lost
revenues.'' The Commission seeks comment on how to interpret ``lost
revenues'' for purposes of the reimbursement mandate.
230. The Commission also seeks comment on whether and how to
prioritize requests for reimbursement in the event that the total
eligible relocation costs exceed the statutory limit of $1.75 billion.
Should it consider reimbursement requests on a first-come, first-served
basis? Should it prioritize requests on some other basis? The
Commission invites commenters to address the potential costs and
benefits associated with any prioritization methods that they advocate.
231. Further, the Commission seeks comment on whether to explore
bulk purchasing opportunities or bulk services arrangements that could
reduce the relocation costs incurred by individual television licensees
as a result of the repacking. In addition, during the digital
television transition, some stations were able to repurpose their own
analog and pre-transition digital equipment, or that of another
station, for post-transition use. The Commission seeks comment on
methods to encourage broadcasters to make use of equipment that is no
longer needed by a repacked or channel sharing licensee.
232. Service Rule Waiver in Lieu of Reimbursement. Pursuant to the
Spectrum Act, instead of reimbursement for repacking costs, a
television licensee may accept a waiver of the Commission's service
rules to permit it to make flexible use of its spectrum to provide non-
broadcast services, so long as it ``provides at least 1 broadcast
television program stream on such spectrum at no charge to the
public.'' The Commission invites comment on the meaning and scope of
this provision.
[[Page 69968]]
In particular, which of our rules should be eligible for waiver under
this provision? What types of flexible uses by broadcasters should it
consider appropriate in this context, and what factors should go into
this analysis? How can the Commission assess whether flexible use
operations by broadcasters would cause interference problems? Should
waivers be granted on a permanent or temporary basis? If the latter,
for how long should the waiver last? How should the Commission
interpret the requirement of a ``broadcast television program stream''
provided ``at no charge to the public''? Would use of a technology
other than the ATSC digital television standard satisfy this
requirement? If so, what steps would a licensee need to take to ensure
the ability of ``the public'' to view the broadcast television program
stream at no charge?
233. In addition, the Commission seeks comment on appropriate
procedures for the filing and review of any such waiver requests. At
what point should any such requests be entertained, and how should they
be submitted? Should they be subject to public notice and an
opportunity for comment? Should the Commission require submission of
any waiver requests at the same time and using the same procedures as
for reimbursement requests? How can we ensure that a licensee whose
waiver request is not granted has an opportunity to obtain
reimbursement for its eligible relocation costs?
2. Payment of Eligible MVPD Costs
234. The Commission seeks comment on the Spectrum Act mandate that
the Commission reimburse, from the TV Broadcaster Relocation Fund,
costs reasonably incurred by an MVPD in order to continue to carry the
signal of a broadcast television licensee that has its channel changed
as part of the repacking process or that relinquishes its spectrum
usage rights through a winning UHF to VHF or channel sharing bid in the
reverse auction. Should the Commission allow MVPDs to elect to be
reimbursed by an advance payment based on estimated costs, as proposed
above for broadcasters? If so, how should it estimate costs? Should all
MVPDs be eligible for reimbursement based upon the same estimated
amount per station change? If so, should there be one estimated rate or
rate tiers? On what basis should the Commission choose different tiers?
As with the broadcaster reimbursements, the Commission seeks comment on
whether to require an MVPD receiving an advance payment to report on
whether they spent all of their reimbursement funds and to promptly
return any unused funds. The Commission invites comment on these and
any other issues raised by an estimated-cost reimbursement approach.
235. Regardless of whether it decides to allow MVPDs to elect to be
reimbursed by an advance payment based on estimated costs, the
Commission invites comment on reimbursing MVPDs based on actual costs.
The Commission proposes to require documentation of all expenses under
an actual-cost approach. MVPDs would be required to submit a showing,
including appropriate documentation, detailing their costs, as well as
a demonstration that all such costs are reasonable, prior to
reimbursement. As with broadcaster reimbursement, the Commission seeks
comment on whether to cap actual cost-based payments. If its sets such
caps, how should it determine the appropriate limits? Should it provide
reimbursement in excess of any caps upon an appropriate showing? The
Commission seeks comment on the appropriate procedures to use for
documentation of costs.
236. Further, the Commission seeks comment on the types of costs
that MVPDs are likely to incur, and how to determine whether such costs
are ``reasonable'' for purposes of the reimbursement mandate. For
example, MVPDs incurred costs during the digital television transition
in fulfilling the mandate that they ``ensure that the transition went
smoothly for their customers.'' Similarly, what costs will MVPDs likely
incur to carry stations involuntarily assigned to new channels in the
repacking process? Should the Commission interpret the statute to
provide for reimbursement of costs incurred in carrying a channel
sharing station from the shared location if the station previously did
not qualify for carriage on the MVPD system?
3. Measures To Prevent Waste, Fraud and Abuse
237. The Commission seeks comment on potential waste, fraud and
abuse of the TV Broadcaster Relocation Fund, and how to prevent it.
What steps might be taken to prevent such abuse? If the Commisison
permits broadcasters and MVPDs to seek reimbursement based upon the
estimated cost approach proposed above, it seeks comment on whether to
require the receiving entity to report on whether they spent all of
their reimbursement funds and to return any unused or misused funds.
238. The Commission seeks comment on whether appointment of a
third-party auditor to over see the Relocation Fund would help further
its goals to prevent waste, fraud and abuse.
C. Regulatory Issues; Licensing and Operating Rules
1. Broadcast Issues
a. Multiple Ownership Rules
239. In fairness to entities with broadcast multiple ownership
combinations that could be rendered out of compliance due to channel
allotments or technical changes resulting from repacking, the NPRM
proposes that such ownership combinations be permanently
``grandfathered.'' The Commission proposes considering any other
multiple ownership issues that result from the incentive auction in its
ongoing quadrennial review proceeding.
240. The Commission also invites comment on measures that it might
take outside of the context of the multiple ownership rules to address
any impact on diversity that may result from the incentive auction.
b. Displacement of Low Power Television Stations
241. The Commission recognizes that low power television and TV
translator stations may be greatly impacted by repacking. Because they
have only secondary interference protection rights, LPTVs will not be
permitted to participate in the reverse auction and will not be
protected during repacking. Many stations will be displaced from their
current operating channel. To ease the burden on these stations, the
Commission proposes allowing displaced LPTV stations to have the first
opportunity to submit a displacement application and propose a new
operating channel. The Commission also cited the need to determine how
to resolve mutually exclusive displacement applications filed by LPTV
stations displaced by repacking. The Commission proposes adopting a set
of priorities and seeks comment on the types of priorities to
recognize. The Commission specifically seeks comment on the impact of
such displacement of LPTV stations, and of the priorities by which
displacement applications will be evaluated, on small, minority-owned,
and women-owned LPTV stations. Comment is sought on suggestions for
alternative criteria or procedures for allocating available channels
among low power television and translator stations at risk of
displacement following the incentive auctions.
c. Channel Sharing
242. The Commission seeks comment on several issues related to
channel
[[Page 69969]]
sharing that were not resolved in the Commission's Channel Sharing
Report and Order, ET Docket No. 10-235, Report and Order, 27 FCC Rcd
4616 (2012). For example, the Commission seeks comment on whether and
when channel sharing agreements (CSAs) should be filed with the
Commission and whether CSAs should be required to contain certain
provision concerning access to, maintenance of, and modification of the
shared transmission facilities. The Commission also seeks comment on
how to resolve the termination of CSAs. Should the Commission require
that CSAs grant approval rights or rights of first refusal to channel
sharing stations in the event of a proposed assignment or transfer of
the license held by the other station or stations. Alternatively,
should the Commission mandate that CSAs require future buyers to assume
the exiting party's rights and obligations under the CSA? Should all
licensee parties to a CSA demonstrate assent to a proposed transaction
in the assignment or transfer application related to that deal? Comment
also is sought whether all parties to a CSA should be jointly
responsible for compliance with certain of the Commission's rules.
Comments is sought on proposals for retaining NCE status when an NCE
licensee enters into a CSA with a commercial station. The Commission
proposes that an NCE licensee, whether it relinquishes its reserved
channel in order to share a non-reserved channel, or agrees to share
its reserved channel with a commercial station, retain its NCE status
on its license and be required to continue to comply with the rules and
policies applicable to NCE licensees. Finally, the Commission proposes
that the Spectrum Act provision on preservation of cable and satellite
carriage would not affect the carriage rights of Class A stations. The
Commission notes that the resolution of these issues is important in
order to provide needed clarity to parties considering participating in
the reverse auction through a channel sharing bid.
2. Wireless Issues
a. Flexible Use, Regulatory Framework, and Regulatory Status
(i) Flexible Use
243. We are proposing service rules for the 600 MHz band that
permit a licensee to employ the spectrum for any use permitted by the
United States Table of Frequency Allocations contained in part 2 of our
rules, subject to our service rules. Congress recognized the potential
benefits of flexibility in allocations of the electromagnetic spectrum
and amended the Communications Act in 1999 to add section 303(y). In
addition, the Spectrum Act provides that any initial licenses for use
of spectrum made available for assignment by the voluntary
relinquishment of broadcast television licensees shall be subject to
flexible-use service rules.
244. Thus, we propose that the 600 MHz band may be used for any
fixed or mobile service that is consistent with the allocations for the
band. If commenters think any restrictions are warranted, they should
describe why such restrictions are needed, quantify the costs and
benefits of any such restrictions, and describe how such restrictions
would comport with the statutory mandates of section 303(y) of the
Communications Act and sections 6402 and 6403 of the Spectrum Act.
(ii) Regulatory Framework
245. Consistent with flexible use of these bands, we also propose
licensing the spectrum under the flexible regulatory framework of part
27 of our rules. Unlike other rule parts applicable to specific
services, part 27 does not prescribe a comprehensive set of licensing
and operating rules for the spectrum to which it applies. Rather, for
each frequency band under its umbrella, part 27 defines permissible
uses and any limitations thereon, and specifies basic licensing
requirements. We seek comment on our proposal to license the 600 MHz
band under part 27 service and licensing rules, and any associated
costs or benefits of doing so.
(iii) Regulatory Status
246. We propose to apply the regulatory status provisions of
section 27.10 of the Commission's rules to 600 MHz licensees. Under
this rule, applicants who may wish to provide both common carrier and
non-common carrier services (or switch between them) can request status
as both a common carrier and a non-common carrier under a single
license, and are able to provide all allowable services anywhere within
their licensed area at any time, consistent with their regulatory
status designated on their license application. Apart from this
designation, applicants do not need to describe the services they seek
to provide. We seek comment on this approach and the attendant costs
and benefits.
247. We also propose that a licensee must notify the Commission of
any change in regulatory status, as described in 47 CFR 27.10.
Consistent with this rule, we propose to require that a licensee notify
the Commission within 30 days of a change made without the need for
prior Commission approval, except that a different time period may
apply where the change results in the discontinuance, reduction, or
impairment of the existing service. We seek comment on this proposal,
including the costs and benefits of this proposal.
b. License Restrictions
(i) Foreign Ownership
248. We propose to apply the provisions of section 27.12 of the
Commission's rules to applicants for licenses in the 600 MHz band.
Section 27.12 implements section 310 of the Communications Act,
including foreign ownership and citizenship requirements that restrict
the issuance of licenses to certain applicants. An applicant requesting
authorization to provide services in this band other than broadcast,
common carrier, aeronautical en route, and aeronautical fixed services
would be subject to the restrictions in section 310(a), but not to the
additional restrictions in section 310(b). An applicant requesting
authorization for broadcast, common carrier, aeronautical en route, or
aeronautical fixed services would be subject to both sections 310(a)
and 310(b). We do not believe that applicants for this band should be
subject to different obligations in reporting their foreign ownership
based on the type of service authorization requested in the
application. Consequently, we propose to require all applicants to
provide the same foreign ownership information, which covers both
sections 310(a) and 310(b), regardless of which service they propose to
provide in the band. We note, however, that we would be unlikely to
deny a license to an applicant requesting to provide exclusively
services that are not subject to section 310(b), solely because its
foreign ownership would disqualify it from receiving a license if the
applicant had applied for authority to provide such services. However,
if any such licensee later desires to provide any services that are
subject to the restrictions in section 310(b) we would require the
licensee to apply to the Commission for an amended license, and we
would consider issues related to foreign ownership at that time. We
request comment on this proposal, including any costs and benefits of
this proposal.
(ii) Eligibility and Mobile Spectrum Holding Policies
249. We propose to adopt an open eligibility standard for the 600
MHz band. We believe that opening the 600
[[Page 69970]]
MHz band to as wide a range of licensees as possible will encourage
efforts to develop new technologies, products and services, while
helping to ensure efficient use of this spectrum. An open eligibility
standard is consistent with the Commission's past practice for mobile
wireless spectrum allocations, as well as with section 6404 of the
recently adopted Spectrum Act, which provides that the Commission may
not prevent a person from participating in a system of competitive
bidding, provided that the person complies with all procedures and
other requirements established to protect the auction process, and
meets specified technical, financial, character, and citizenship
qualifications or would do so prior to the grant of a license by means
approved by the Commission. We seek comment on our open eligibility
approach.
250. We note that an open eligibility approach would not affect
citizenship, character, or other generally applicable qualifications
that may apply under our rules. As discussed above, we propose to
implement section 6004 of the Spectrum Act, which restricts auction
participation for reasons of national security, by requiring applicants
participating in the broadcast incentive auction to certify, under the
penalty of perjury, that they are not ``person[s] who [have] been, for
reasons of national security, barred by any agency of the Federal
Government from bidding on a contract, participating in an auction, or
receiving a grant.'' Section 6004 does not address eligibility to
acquire licenses from holders thereof in auctioned (or any other)
services. We seek comment on whether section 6004 permits or requires
the Commission to restrict eligibility of the persons described therein
to acquire licenses in the secondary market, and whether and to what
extent the provisions of the Communications Act permit such
restrictions. If such restrictions should be implemented, should we do
so by requiring certifications in applications similar to those
required under our rules for enforcement of the Anti-Drug Abuse Act of
1988? Would it be permissible and appropriate, as we do under our
character policy, to address such situations on a case-by-case basis in
light of the specific facts and circumstances? See 47 CFR 1.2001.
Should we apply the same attribution rules in doing so, where the
relevant person is not the sole owner of the proposed licensee?
251. Section 309(j)(3)(B) of the Communications Act provides that
in designing systems of competitive bidding, the Commission shall
``promot[e] economic opportunity and competition and ensur[e] that new
and innovative technologies are readily accessible to the American
people by avoiding excessive concentration of licenses.'' More
recently, section 6404 of the Spectrum Act recognizes the Commission's
authority ``to adopt and enforce rules of general applicability,
including rules concerning spectrum aggregation that promote
competition.''
252. In the past, the Commission has sought comment on spectrum
aggregation issues with respect to particular spectrum bands prior to
auctioning spectrum licenses. We seek comment on what, if anything, the
Commission should do to meet the statutory requirements of section
309(j)(3)(B) and promote the goals of the broadcast television spectrum
incentive auction. For instance, we note that under current spectrum
aggregation policies, the Commission would apply its spectrum screen
and undertake its competitive analysis only after the auction. As
discussed above, however, it is of particular importance to have
certainty for bidders in this auction. As another example, section
309(j)(3)(B)'s direction to avoid excessive concentration of licenses
might militate in favor of a rule that permits any single participant
in the auction to acquire no more than one-third of all 600 MHz
spectrum being auctioned in a given licensed area. Commenters may also
discuss variations of that approach, including whether we should adopt
thresholds that differ in urban and rural areas, whether we should
adopt a threshold that recognizes the different characteristics of
different spectrum bands, and/or whether we should adopt a threshold
that would allow a licensee to acquire additional 600 MHz spectrum
above that threshold so long as the licensee agrees to comply with
certain conditions such as spectrum sharing through roaming and/or
resale obligations, infrastructure sharing, or accelerated buildout
requirements. We seek comment on the best means to achieve the goals
established by Congress.
c. Secondary Markets
(i) Partitioning and Disaggregation
253. Part 27 rules for terrestrial wireless service provide that
licensees may apply to partition their licensed geographic service
areas or disaggregate their licensed spectrum at any time following the
grant of their licenses. The rules also set forth the general
requirements that apply with regard to approving applications for
partitioning or disaggregation, as well as other specific requirements
(e.g., performance requirements) that would apply to licensees that
hold licenses created through partitioning or disaggregation.
254. We propose to permit partitioning and disaggregation by
licensees in the 600 MHz band. See 47 CFR 27.15. To ensure that the
public interest would be served if partitioning or disaggregation is
allowed, we also propose requiring each 600 MHz licensee who is a party
to a partitioning, disaggregation, or combination of both, to
independently meet the applicable performance and renewal requirements.
We believe this approach would facilitate efficient spectrum use, while
enabling service providers to configure geographic area licenses and
spectrum blocks to meet their operational needs. We seek comment on
these proposals. Commenters should discuss and quantify the costs and
benefits of these proposals on competition, innovation, and investment.
255. We also seek comment on whether the Commission should adopt
additional or different mechanisms to encourage licensees to partition
and/or disaggregate 600 MHz spectrum that they are not utilizing and
the extent to which such policies would promote additional wireless
broadband service, especially in rural areas. Commenters should discuss
and quantify the costs and benefits of promoting partitioning and
disaggregation in the 600 MHz band, including the effects of the
proposal on competition, innovation, and investment.
(ii) Spectrum Leasing
256. We propose that the spectrum leasing policies established in
the Promoting Efficient Use of Spectrum Through Elimination of Barriers
to the Development of Secondary Markets 68 FR 66232 (2003) and the
Promoting Efficient Use of Spectrum Through Elimination of Barriers to
the Development of Secondary Markets 69 FR 77522 (2004) proceedings be
applied to the 600 MHz band in the same manner that those policies
apply to other part 27 services. We seek comment on this proposal.
Commenters should discuss the effects on competition, innovation and
investment, and on extending our secondary spectrum leasing policies
and rules to 600 MHz spectrum.
d. License Term, Performance Requirements, Renewal Criteria, and
Permanent Discontinuance of Operations
(i) License Term
257. The Communications Act does not specify a term limit for
wireless
[[Page 69971]]
radio services licenses, but the Commission has adopted 10-year license
terms for most wireless licenses. We propose that in the 600 MHz band
the license term similarly be 10 years. We seek comment on this
proposal, and other proposals by commenters, including any costs and
benefits of the proposals. In addition, commenters can submit their own
proposal for the appropriate license term, which should similarly
include a discussion on the costs and benefits. Further, we anticipate
that wireless licenses would be issued by the completion of the
broadcast transition discussed above, and it is our goal to issue most
wireless licenses within 6-9 months of the completion of the auctions.
We invite comment on whether this time frame is a reasonable goal.
258. Under our license term proposal, if a license in these bands
is partitioned or disaggregated, any partitionee or disaggregatee would
be authorized to hold its license for the remainder of the
partitioner's or disaggregator's original license term. This approach
is similar to the partitioning provisions the Commission adopted for
BRS, for broadband PCS licensees, for the 700 MHz band licensees, and
for AWS-1 licenses at 1710-1755 MHz and 2110-2155 MHz. We emphasize
that nothing in our proposal is intended to enable a licensee, by
partitioning or disaggregating, to be able to confer greater rights
than it was awarded under the terms of its license grant; nor would any
partitionee or disaggregatee obtain rights in excess of those
previously possessed by the underlying Commission licensee. We seek
comment on these proposals, including the cost and benefits of these
proposals.
(ii) Performance Requirements
259. The Commission establishes performance requirements to promote
the productive use of spectrum, to encourage licensees to provide
service to customers in a timely manner, and to promote the provision
of innovative services in unserved areas, particularly in rural areas.
We propose adopting performance requirements for the 600 MHz band. We
note that the propagation characteristics of the 600 MHz band should
allow for robust coverage at a lower cost than some other comparable
bands. We encourage commenters to account for these and other technical
characteristics as they address the topic of performance requirements.
260. We seek comment on three aspects of performance requirements:
(1) What type of construction requirements we should impose (e.g., a
``substantial service'' requirement or specific quantifiable coverage
target, measured as a percentage of a population or geographic area);
(2) when we should measure compliance with the requirements (e.g.,
using interim benchmarks, an end-of-term goal, or multiple benchmarks);
and (3) what sorts of penalties we should impose for licensees that
fail to meet the requirements.
261. Construction Requirements. To ensure that licensees begin
providing service to consumers in a timely manner, we propose adopting
specific quantifiable benchmarks as an important component of our
performance requirements. We seek comment on whether we should adopt an
interim benchmark (e.g., at 3 or 4 years from the license issue date),
an end-of-term benchmark, and/or multiple benchmarks throughout the
license term. We propose to measure build-out progress according to
percentage of population served within the license area. In the
alternative, we seek comment on whether we should use geographic area
served. We also seek comment on what percentages would be appropriate
population- or geography-based targets.
262. Penalties for Failure To Meet Construction Requirements. Along
with these benchmarks, we must have meaningful and enforceable
consequences, or penalties, for failing to meet construction
requirements. We seek comment on which penalties will most effectively
ensure timely build-out. For example, we seek comment on whether a
licensee's failure to meet an interim benchmark should result in a
reduction of the overall length of the license term. We also seek
comment on whether failure to meet an end-of-term benchmark should
result in license cancellation, loss of authorization for the unserved
portions of a license area, or alternatively, a requirement to offer
any unused spectrum for lease. Is the threat of license cancellation
for failing to meet a benchmark more effective at promoting timely
build-out than other penalties the Commission has implemented
historically? Are there other penalties that would be effective in
promoting timely build-out? Commenters should discuss the appropriate
penalties and the attendant costs and benefits of imposing such
requirements.
263. Build-Out Approaches. In light of the variety of service
benchmarks and penalties that we discuss above, we seek comment on the
most effective combination for fostering build-out of the 600 MHz
spectrum, including several approaches we have adopted for other
wireless broadband spectrum bands.
264. PCS. We seek comment on whether we should mirror the approach
adopted in the broadband PCS services and subsequently adopted or
proposed in other services (e.g., 2.3 GHz WCS band, AWS-4 NPRM),which
includes specific interim and final build-out requirements with
licenses automatically terminating if the licensee fails to construct.
265. 700 MHz. We seek comment on whether we should adopt an
approach similar to that used in the 700 MHz band. Specifically, we
seek comment on whether we should adopt rules similar to those for
Upper 700 MHz C-Block licensees, which require them to meet specific
interim and end-of-term population-based benchmarks, and include
reducing their license term for failing to meet the interim benchmark,
thus requiring them to meet their end-of-term benchmark on an
accelerated schedule. We also seek comment on whether we should adopt a
``keep-what-you-use'' re-licensing mechanism, under which a licensee
that fails to meet its final construction benchmark loses authorization
for unserved portions of its license area, which are then returned to
the Commission for reassignment.
266. ``Triggered'' Keep-What-You-Use. We also seek comment on a
variation of the ``keep-what-you-use'' rule, which was originally
proposed in the 700 MHz context. Specifically, we ask whether the
Commission, rather than reclaiming ``unused'' spectrum after a period
of time, should reclaim spectrum only in the event that a third party
seeks access to the licensed spectrum in an unserved portion of the
license area. We seek comment on whether this triggered approach may
offer a more efficient spectrum relicensing mechanism than the ``keep-
what-you-use'' rule, because the Commission would only reclaim spectrum
that a new licensee is ready to build. We further seek comment on two
variations of this approach. In the first, as was proposed in 700 MHz,
the achievement of a final build-out milestone would preclude third
party applications for ``unused'' spectrum. In the second variation,
and most similar to the original cellular construction rules, we would
forego a final benchmark requirement, and simply allow licensees to
only ``keep-what-you-use'' at the end of their license terms,
regardless of how much of their license area they build out.
267. We also seek comment on the appropriate relicensing process
under a triggered ``keep-what-you-use'' rule. For example, should we
follow the process set forth in the 700 MHz rules? If so,
[[Page 69972]]
how should we address the variations that a ``triggered keep-what-you-
use'' model establishes, such as what steps the Commission, or the
licensee, should take to notify third parties about what ``unserved''
portions are available?
268. ``Use It or Lease It.'' We also seek comment on whether
``keep-what-you-use'' approaches are an effective means to provide
additional service in unserved areas, including in rural areas, or
whether another approach is advisable to meet this goal. For example,
we seek comment on whether, instead of taking back unused portions of a
license, we should require the licensee to lease the unused spectrum.
Specifically, we ask whether licensees should be required to
participate in good faith negotiations with third parties expressing an
interest in spectrum leasing in license areas that have not been built-
out at the end of the initial term. If so, what specific good faith
negotiation process should we require? For all build-out approaches
addressed in their comments, commenters should discuss and quantify how
any supported build-out requirements will affect investment and
innovation, as well as discuss and quantify other costs and benefits
associated with their proposals.
269. ``Use It or Share It.'' In lieu of a ``use it or lease it''
approach, we also seek comment on whether, following the build-out
term, we should permit third parties to make use of unused spectrum on
a localized basis until a licensee deploys service in those areas.
Specifically, for the 600 MHz spectrum, we seek comment on whether a
``use it or share it'' approach is feasible in areas where a licensee
has failed to deploy service by the end of its build-out term. If we do
adopt this approach, how should we permit third parties to gain access
to unused spectrum? For example, should we allow unlicensed use of such
spectrum through the white spaces database systems? What other
processes should we consider?
270. Other Approaches. We also seek comment on any other
construction models that might be appropriate to the 600 MHz context,
including approaches used successfully in other spectrum bands.
271. Compliance Procedures. Assuming that we adopt interim and end-
of-term construction benchmarks, we propose requiring licensees to
demonstrate compliance with these performance requirements. We note
that 600 MHz licensees would be subject to our generally applicable
rules specifying that licensees file a construction notification within
15 days of the relevant benchmark certifying that they have met the
applicable performance benchmark. Consistent with the 700 MHz rules, we
propose that if a licensee has not met our performance requirements,
the licensee must file a description and certification for the areas
for which they are providing service. If we adopt a triggered ``keep-
what-you-use'' relicensing mechanism or another mechanism that requires
licensees to make unserved areas available to third parties (such as
``use it or lease it''), we seek comment on whether additional filing
requirements are necessary. We believe that transparency is integral to
the success of these approaches, and ask commenters to discuss what
specific information we should require licensees to provide to ensure
that third parties can determine what spectrum is available.
272. Renewal. We seek comment on how our approach to performance
requirements can work effectively with our separate renewal criteria
standard for 600 MHz licenses. While the distinctions between
performance requirements and renewal standards are discussed in detail
below, we seek comment on the costs and benefits of requiring separate
filings to prove compliance with separate performance requirement and
renewal standards. Further, if the Commission adopts a triggered
``keep-what-you-use'' or ``use it or lease it'' approach, how should we
evaluate a licensee's renewal application where a licensee has not met
our build-out requirements but is otherwise required to make unused
spectrum available to third parties?
(iii) Renewal Criteria
273. Pursuant to section 308(b) of the Communications Act, the
Commission may require renewal applicants to ``set forth such facts as
the Commission by regulation may prescribe as to the citizenship,
character, and financial, technical, and other qualifications of the
applicant to operate the station'' as well as ``such other information
as it may require.'' We note that 600 MHz licensees would be subject to
our generally applicable rules regarding renewal filings. We propose to
adopt service-specific 600 MHz license renewal requirements consistent
with those adopted in the 700 MHz First Report and Order and which form
the basis of the renewal paradigm proposed in the WRS Renewal NPRM and
Order. See Service Rules for the 698-746, 747-762 and 777-792 MHz
Bands, 72 FR 24238 (2007) (700 MHz First Report and Order); Amendment
of parts 1, 22, 24, 27, 74, 80, 90, 95, and 101 To Establish Uniform
License Renewal, Discontinuance of Operation, and Geographic
Partitioning and Spectrum Disaggregation Rules and Policies for Certain
Wireless Radio Services, 75 FR 38959 (2010) (WRS Renewal NPRM and
Order).
274. We emphasize that, as the Commission made clear in both of
these items, a licensee's performance showing and its renewal showing
are two distinct showings. Broadly speaking, a performance showing
provides a snapshot in time of the level of a licensee's service. By
contrast, a renewal showing provides information regarding the level
and types of the licensee's service offered over its entire license
term. We propose that applicants for renewal of 600 MHz licenses file a
``renewal showing,'' in which they demonstrate that they have and are
continuing to provide service to the public, and are compliant with the
Commission's rules and policies and [with] the Communications Act. In
the 700 MHz First Report and Order, the Commission explained that, in
the renewal context, the Commission considers ``a variety of factors
including the level and quality of service, whether service was ever
interrupted or discontinued, whether service has been provided to rural
areas, and any other factors associated with a licensee's level of
service to the public.'' The WRS Renewals NPRM and Order also proposed
to consider the extent to which service is provided to qualifying
tribal lands. We propose that these same factors should be considered
when evaluating renewal showings for the 600 MHz band and seek comment
on this approach. Commenters should discuss and quantify the costs and
benefits of this approach on competition, innovation, and investment.
275. To further encourage licensees to comply with their
performance obligations, we propose awarding renewal expectancies to
600 MHz licensees that meet their performance obligations, and have
otherwise complied with the Commission's rules and policies and the
Communications Act during their license term. We seek comment on the
above proposal and on whether 600 MHz licensees should obtain a renewal
expectancy for subsequent license terms, if they continue to provide at
least the level of service demonstrated at the final performance
benchmark through the end of any subsequent license terms. In addition,
we seek comment on how a licensee's failure to meet its performance
requirements should affect its ability to renew its license. Commenters
should discuss and quantify the costs and benefits of each
[[Page 69973]]
approach on competition, innovation, and investment.
276. Finally, consistent with the 700 MHz First Report and Order
and the WRS Renewals NPRM and Order, we propose to prohibit the filing
of mutually exclusive applications at the time of renewal, and that if
a license is not renewed, the associated spectrum would be returned to
the Commission for reassignment. We seek comment on these proposals,
including the costs and benefits of these proposals.
(iv) Permanent Discontinuance of Operations
277. We also request comment on whether to apply to licensees in
the 600 MHz band the Commission's rules governing the permanent
discontinuance of operations, which are intended to afford licensees
operational flexibility to use their spectrum efficiently while
ensuring that spectrum does not lay idle for extended periods. Under 47
CFR 1.955(a)(3), an authorization will automatically terminate, without
specific Commission action, if service is ``permanently discontinued.''
For the 600 MHz band, we propose to define ``permanently discontinued''
as a period of 180 consecutive days during which a licensee does not
operate and does not serve at least one subscriber that is not
affiliated with, controlled by, or related to the provider. We believe
this definition strikes an appropriate balance between our twin goals
of providing licensees operational flexibility while ensuring that
spectrum does not lie fallow. Licensees would not be subject to this
requirement until the date of the first performance requirement
benchmark so they will have adequate time to comply. In addition,
consistent with Sec. 1.955(a)(3) of the Commission's rules, we propose
that, if a 600 MHz licensee permanently discontinues service, the
licensee must notify the Commission of the discontinuance within 10
days by filing FCC Form 601 or 605 and requesting license cancellation.
An authorization will automatically terminate without specific
Commission action if service is permanently discontinued even if a
licensee fails to file the required form.
e. Other Operating Requirements
278. Even though licenses in the 600 MHz band may be issued
pursuant to one rule part, licensees in this band may be required to
comply with rules contained in other parts of the Commission's rules,
depending on the particular services they provide. For example:
Applicants and licensees would be subject to the
application filing procedures for the Universal Licensing System, set
forth in part 1 of our rules.
Licensees would be required to comply with the practices
and procedures listed in part 1 of our rules for license applications,
adjudicatory proceedings, etc.
Licensees would be required to comply with the
Commission's environmental provisions, including 47 CFR 1.1307.
Licensees would be required to comply with the antenna
structure provisions of part 17 of our rules.
To the extent a licensee provides a Commercial Mobile
Radio Service, such service would be subject to the provisions of part
20 of the Commission's rules, including 911/E911 and hearing aid-
compatibility (HAC) requirements, along with the provisions in the rule
part under which the license was issued. Part 20 applies to all CMRS
providers, even though the stations may be licensed under other parts
of our rules.
To the extent a licensee provides interconnected VoIP
services, the licensee would be subject to the E911 service
requirements set forth in part 9 of our rules.
The application of general provisions of parts 22, 24, 27,
or 101 would include rules related to equal employment opportunity,
etc.
279. We seek comment on whether we need to modify any of these
rules to ensure that 600 MHz licensees are covered under the necessary
provisions. We seek comment on applying these rules to the 600 MHz
spectrum and specifically on any rules that would be affected by our
proposal to apply elements of the framework of these parts, whether
separately or in conjunction with other requirements.
Initial Regulatory Flexibility Analysis
1. As required by the Regulatory Flexibility Act of 1980, as
amended (``RFA'') \1\ the Commission has prepared this present Initial
Regulatory Flexibility Analysis (``IRFA'') concerning the possible
significant economic impact on small entities by the policies and rules
proposed in this NPRM. Written public comments are requested on this
IRFA. Comments must be identified as responses to the IRFA and must be
filed by the deadlines for comments indicated on the first page of the
NPRM. The Commission will send a copy of the NPRM, including this IRFA,
to the Chief Counsel for Advocacy of the Small Business Administration
(SBA).\2\ In addition, the NPRM and IRFA (or summaries thereof) will be
published in the Federal Register.\3\
---------------------------------------------------------------------------
\1\ See 5 U.S.C. 603. The RFA, see 5 U.S.C. 601 et. seq., has
been amended by the Small Business Regulatory Enforcement Fairness
Act of 1996 (``SBREFA''), Public Law 104-121, Title II, 110 Stat.
847 (1996). The SBREFA was enacted as Title II of the Contract With
America Advancement Act of 1996 (``CWAAA'').
\2\ See 5 U.S.C. 603(a).
\3\ See id. sec. 603(a).
---------------------------------------------------------------------------
A. Need for and Objectives of the Proposed Rules
2. In the NPRM, the Commission considers matters related to the
implementation of Congress's mandate to conduct an incentive auction of
broadcast television spectrum as set forth in the Middle Class Tax
Relief and Job Creation Act of 2012, Public Law 112-96, Sec. Sec.
6402, 6403, 125 Stat. 156 (2012) (Spectrum Act). Congress's passage of
the Spectrum Act set the stage for this proceeding and further expanded
the Commission's ability to facilitate technological and economic
growth. Wireless broadband is now a key component of economic growth,
job creation and global competitiveness, and the explosive growth of
wireless broadband services has created increased demand for wireless
spectrum. Government entities and private industry alike have
recognized the urgent need for more spectrum for wireless broadband
services, and have been working to increase the availability of
spectrum for these valuable uses. As part of the American Recovery and
Reinvestment Act of 2009, Congress directed the FCC to develop a
``national broadband plan'' to ensure that every American has ``access
to broadband capability.'' The resulting National Broadband Plan
emphasized the indispensable importance of wireless spectrum in
achieving Congress's broadband goals, recommending that the Commission
make 300 megahertz of spectrum available for mobile broadband use
within five years, including by reallocating a portion of the broadcast
television spectrum.
3. The Spectrum Act authorizes the Commission to conduct incentive
auctions in which licensees may voluntarily relinquish their spectrum
usage rights in order to permit the assignment by auction of new
initial licenses subject to flexible use service rules, in exchange for
a portion of the resulting auction proceeds. Section 6403 of the
Spectrum Act, which is not codified in the Communications Act, requires
the Commission to conduct an incentive auction of the broadcast
television spectrum and includes
[[Page 69974]]
specific requirements and safeguards for the required auction.
4. The purpose of the NPRM is to develop rules and policies for the
incentive auction process. The incentive auction will have three major
pieces: (1) A ``reverse auction'' in which broadcast television
licensees submit bids to voluntarily relinquish certain broadcast
rights in exchange for payments; (2) a reorganization or ``repacking''
of the broadcast television bands in order to free up a portion of the
ultra-high frequency (UHF) band for other uses; and (3) a ``forward
auction'' of initial licenses for flexible use of the newly available
spectrum.
5. Section 6403 of the Spectrum Act directs the Commission to
conduct an incentive auction of broadcast television spectrum and
includes special requirements for such an auction.\4\ The incentive
auction will have two competitive bidding components: (1) A ``reverse
auction'' in which broadcast television licensees submit bids to
voluntarily relinquish certain broadcast rights in exchange for
payments; and (2) a ``forward auction'' of initial licenses for
flexible use of the newly available spectrum.\5\ In order to implement
this congressional mandate to conduct an incentive auction of broadcast
television spectrum, the NPRM proposes and seeks comment on proposals
to devise auction design and competitive bidding rules to govern the
reverse auction, and considers changes to the Commission's general
competitive bidding rules in Part 1 that may be necessary or desirable
to conduct the related forward auction for new spectrum licenses. For
example, the Commission will be seeking comment on: (i) Bid collection
procedures that determine how bids in the auction are gathered, (ii)
assignment procedures that determine which bids are accepted, and (iii)
pricing procedures that determine what each bidder pays, or in the case
of the reverse auction, receives in payment. The other major component
of the incentive auction--the repacking--will help to determine which
reverse auction bids will be accepted. In addition, consistent with the
Commission's typical approach to spectrum license auctions, the
proposed rules and Part 1 rule revisions provide a general framework to
guide the development--through a series of public notices with
opportunities for comment--of the detailed procedures and deadlines
needed to conduct the auction. The public notice process will allow
both the Commission and interested parties to focus and provide input
on certain details of the auction design and the auction procedures
after the rules have been established and the remaining procedural
issues are better defined.
---------------------------------------------------------------------------
\4\ See Spectrum Act Sec. 6403.
\5\ See id. at secs. 6403(a)-(c). See also id. at secs.
6001(16), (30) (defining ``forward auction'' and ``reverse
auction,'' respectively). Note that the incentive auction of
broadcast television spectrum has a third component--a
reorganization or ``repacking'' of the broadcast television spectrum
bands in order to free up a portion of the UHF band for other uses.
---------------------------------------------------------------------------
6. To assist small entities in competitive bidding in the forward
auction, the NPRM proposes to establish small business size standards
that were adopted in the 700 MHz band, as well as bidding credits that
are set forth in the standardized schedule in Part 1 of the
Commission's rules. Specifically, the NPRM proposes to define a ``small
business'' as an entity with average annual gross revenues for the
preceding three years not exceeding $40 million, and a ``very small
business'' as an entity with average annual gross revenues for the
preceding three years not exceeding $15 million. The NPRM also proposes
to provide small businesses with a bidding credit of 15 percent and
very small businesses with a bidding credit of 25 percent.
7. The NPRM proposes to limit participation in the reverse auction
to full power and Class A television licensees and to exclude non-Class
A low power television stations and TV translators (collectively, ``low
power television stations''). The Spectrum Act definitions and its
repacking and reimbursement provisions limit participation to only full
power and Class A television licensees. Further, because low power
television stations have secondary interference rights, these
facilities do not impede the band clearing and repacking process, and
therefore there is no reason to facilitate their relinquishment through
participation in the reverse auction.
8. It is proposed that noncommercial educational television
stations may participate in the reverse auction. The Spectrum Act does
not prohibit participation and the prohibition on subjecting NCEs to
auction in Section 309(j) of the Communications Act would not apply
because the reverse auction is being conducted under a separate Section
309(j) provision. Allowing NCEs to participate will ensure greater
participation in the reverse auction and a return of a greater number
of television channels for reallocation.
9. The NPRM proposes that entities with original construction
permits be allowed to participate in the reverse auction if they become
licensees before the deadline for submission of the application to
participate in the auction. There are only very few entities in this
category, and allowing the few original construction permit holders to
participate in the incentive auction, so long as they receive a license
by the deadline specified above, will maximize the amount of spectrum
available for auction.
10. For the reverse auction bidding, it is proposed that the
Commission only examine the spectrum usage rights held by stations in
their licenses as of February 22, 2012. This conforms to the mandate in
Section 6403 of the Spectrum Act that the Commission protect in
repacking the coverage area and population served by a licensee as of
the Spectrum Act enactment date.
11. For a new station permittee not licensed on February 22, 2012
(but auction eligible because it becomes licensed by the pre-auction
application filing deadline), the Commission proposes to evaluate its
bid based on the spectrum usage rights authorized in the construction
permit it held on February 22, 2012. This approach conforms with the
Commission's proposal to extend repacking protections on public policy
grounds to the facilities authorized in a construction permit for a new
station on February 22, 2012. In order to conform with the mandate in
Section 6403 of the Spectrum Act to make all reasonable efforts to
preserve the coverage area and population served of each television
licensee only as of the Spectrum Act enactment date (February 22,
2012), any modifications made after February 22, 2012 to a licensed
facility or to the construction permit of a new station will not be
considered in evaluating a licensee's spectrum relinquishment offer.
12. Although the Commission seeks to maximize the spectrum
reclaimed in the reverse auction process, it does not want to
compensate a broadcaster for relinquishing spectrum rights to which it
may no longer be entitled as the result of its license having expired,
or having been cancelled or revoked in an enforcement proceeding. On
the other hand, the Commission does not want to let the existence of
such pending proceedings impede the auction process. Therefore, the
Commission proposes that any full power or Class A station with an
expired, cancelled or revoked license should not be eligible to bid in
the reverse auction.
13. In the NPRM, the Commission proposes allowing stations to
participate in the reverse auction by agreeing to relinquish a ``high
VHF channel'' (channels 7-13) in exchange for a ``low VHF channel''
(channels 2-6). Because high VHF spectrum may be more
[[Page 69975]]
desirable than low VHF spectrum to a UHF to VHF bidder, making
additional high VHF spectrum available by encouraging high VHF to low
VHF moves may result in a greater reverse auction participation.
14. The Commission also seeks comment on whether to allow licensees
to participate in the reverse auction by relinquishing spectrum usage
rights through the acceptance of additional interference. By permitting
this type of creative arrangement, the Commission believes it can
potentially create an unencumbered wireless broadband service area
license while still permitting a broadcast licensee to cover a portion
of its service area.
15. The Commission also proposes to prohibit a licensee to
effectuate a channel sharing arrangement that would result in a change
in the station's community of license and/or DMA. The Commission
proposes this limitation because it believes that allowing changes in
community of license in addition to changes in channel assignments
would raise section 307(b) issues such as the fair, efficient and
equitable distribution of service,\6\ and would complicate its
repacking efforts.
---------------------------------------------------------------------------
\6\ See 47 U.S.C. 307(b).
---------------------------------------------------------------------------
16. It is critical, to enable repacking of the broadcast spectrum,
that the Commission determine how to preserve the coverage area and
population served as required by the Spectrum Act. Accordingly, the
Commission seeks comment on engineering and other technical aspects of
the repacking process, in particular Congress's mandate in Section
6403(b)(2) of the Spectrum Act that it make all reasonable efforts to
preserve the coverage area and population served of television stations
in the repacking. The broadcast television spectrum incentive auction
and the associated repacking process could impact both the coverage
area and the population served of television stations. If a station is
assigned to a different channel, then its technical facilities must be
modified in order to replicate its coverage area, because radio signals
propagate differently on different frequencies. These varying
propagation characteristics also mean that a new channel assignment may
change the areas within a station's noise-limited service area affected
by terrain loss. Channel reassignments, and stations going off the air
as a result of the reverse auction, also may change the interference
relationships between stations, which relationships in turn affect
population served. Stations going off the air can eliminate existing
interference to the stations that remain on the air. Likewise, new
channel assignments generally will eliminate interference that the
reassigned stations are now causing or receiving. At the same time, new
channel assignments create a potential for new interference between
nearby stations on the same channel or a first adjacent channel. The
Commission seeks comment on a repacking methodology that takes in
account all of these impacts in order to carry out Congress's mandate
in section 6403(b)(2).
17. The Commission recently adopted rules to enable unlicensed
devices to operate in parts of the TV spectrum that are unused at any
given location. The availability of spectrum in the TV bands for
unlicensed devices is an important part of supporting a robust wireless
marketplace. To this end, the NPRM explores several ways to further
improve the availability of the TV broadcast spectrum for unlicensed
uses.
18. The Commission is developing a band plan for the incentive
auction process that balances flexibility with certainty, accommodating
varying amounts of available wireless spectrum in different geographic
areas rather than requiring that a uniform set of television channels
be cleared nationwide. Specifically, the Commission seeks comment on
whether to keep the downlink spectrum band consistent nationwide while
allowing variations in the amount of uplink spectrum available in any
geographic area. With this approach, the Commission believes it can
ensure as a technical matter that wireless providers will be able to
offer mobile devices that can operate across the country, which should
minimize device cost and interoperability concerns, and allow for
greater economies of scale. The Commission also proposes designating
specific uplink and downlink blocks, pairing them where possible, to
support expansion of cutting-edge wireless broadband technologies.
19. TV channel 37 is not used for TV broadcasting but rather is
allocated for use by radio astronomy and medical telemetry equipment.
TV channel 37 is situated in the spectrum such that it could affect the
viability of certain band plans for wireless broadband service that
would be most viable from a technical and economic standpoint. The
Commission's proposed band plan does not require that existing channel
37 operations be relocated, and instead, attempts to benefit from
allowing existing channel 37 operations to remain in that frequency
band by using channel 37 as a guard band between television operations
and mobile broadband operations.
20. The Commission proposes that, during repacking, it would only
preserve the service areas of full power and Class A television
stations with regard to stations' facilities that were licensed, or for
which an application for license to cover authorized facilities already
was on file with the Commission, as of February 22, 2012. Further, the
Commission proposes to protect the facilities set forth in unbuilt
construction permits for new full power television stations as of
February 22, 2012. It did not propose to protect the facilities
contained in pending facility modification applications. The Commission
found that consideration of all pending facility modification
applications would greatly complicate the repacking analysis by
increasing the amount of facilities under consideration in the
repacking process. Additionally, protection of both a licensed facility
and a modification thereto that would expand or alter the station's
service area would further encumber the spectrum.
21. As it did with respect to reverse auction bids by Class A
stations, the Commission also proposed that Class A stations elect
which facilities they would like protected in repacking. Because Class
A stations are in the middle of a Commission-mandated digital
transition that will not conclude until September 1, 2015, the
Commission found that failing to offer repacking protection to those
digital transition facilities not licensed by February 22, 2012 would
be fundamentally unfair. Moreover, failure to protect these facilities
could make it impossible for certain Class A stations to effectuate
their conversion plans, thus stalling the digital transition.
22. In the NPRM, the Commission proposes to only reimburse full
power television and Class A stations that are repacked their
reasonable expenses (such as a new antenna or transmitter) incurred
during the repacking. The Commission explains that the Spectrum Act
mandates only that a ``broadcast television licensee'' receive
reimbursement. Furthermore, only full power television and Class A
stations have spectrum rights that must be protected in repacking.
Therefore, the Commission believes that full power television and Class
A licensees are the only stations that fall within the statutory
definition of stations that were assigned a new channel in repacking
and that should qualify for reimbursement.
23. The Commission also proposes to limit reimbursement to
multichannel video programming distributors (MVPDs) as defined by
section 602 of the Communications Act. This was the
[[Page 69976]]
definition set forth in the Spectrum Act and the Commission seeks
comment on whether it is appropriate for determining reimbursement from
the Relocation Fund.
24. In the NPRM, the Commission proposes allowing full power and
Class A television stations and MVDPs to elect reimbursement of their
eligible relocation costs based on either their estimated costs or
their actual, out-of-pocket expenditures. Stations and MVPDs choosing
to receive reimbursement based on the estimated cost approach would
receive their reimbursement through an advance payment, while those
choosing reimbursement based on actual costs would receive
reimbursement only after incurring and documenting their costs.
25. The Commission seeks comment on the types of expenses incurred
by stations and MVPDs that would qualify for reimbursement. The
Commission proposes that stations and MVPDs would be able to recover
only costs that are reasonable, prudent and the minimum necessary to
provide facilities and services comparable to those presently in use.
The Commission also seeks comment on whether to permit stations to
request reimbursement for facility upgrades made while effectuating the
channel changes.
26. The Commission proposes a simplified, one-step process for
implementing the post-auction and post-repacking channel changes.
Rather than require stations to go through a prolonged two-step process
of first amending the DTV Table of Allotments and then filing an
application for its repacked facilities, the Commission is proposing
simply to allow stations to file either a license application (for
stations where no technical changes are proposed such as channel
sharing) or a minor change application. The Commission proposes to
expedite the processing of ``check list'' type applications that
certify compliance with the technical rules and no substantial changes
to their modified facilities. The streamlined procedures are meant to
expedite the post-auction licensing and to ensure a smooth post-auction
transition and recovery of channels.
27. In the NPRM, the Commission seeks comment on the amount of time
that stations would need to transition to their repacked channels. The
Commission recognizes the need to recover channels from the auction to
allow their use by new wireless entities but also that stations would
need various amounts of time to modify their facilities to operate on
their repacked channels depending upon the degree of changes needed.
The Commission also recognizes that some stations may need additional
time to complete their facilities and sought comment on the procedures
for allowing for extensions of time.
28. In order to inform the public of the transition that will occur
following the conclusion of the incentive auction and implementation of
repacking, the Commission seeks comment on the types of consumer
education that stations should perform. The Commission cites the need
to notify viewers of channel changes and changes to station facilities
that might result in a loss of service.
29. In fairness to entities with broadcast multiple ownership
combinations that could be rendered out of compliance due to channel
allotments or technical changes resulting from repacking, the NPRM
proposes that such ownership combinations be permanently
``grandfathered.'' The Commission proposes considering any other
multiple ownership issues that result from the incentive auction in its
ongoing quadrennial review proceeding.
30. The Commission recognizes that low power television and
television translator stations may be greatly impacted by repacking.
Because they have only secondary interference protection rights, LPTVs
will not be permitted to participate in the reverse auction and will
not be protected during repacking. Many stations will be displaced from
their current operating channel. To ease the burden on these stations,
the Commission proposes allowing displaced LPTV stations to have the
first opportunity to submit a displacement application and propose a
new operating channel. The Commission also cited the need to determine
how to resolve mutually exclusive displacement applications filed by
LPTV stations displaced by repacking. The Commission proposes adopting
a set of priorities and seeks comment on the types of priorities to
recognize. The Commission specifically seeks comment on the impact of
such displacement of LPTV stations, and of the priorities by which
displacement applications will be evaluated, on small, minority-owned,
and women-owned LPTV stations.
31. The NPRM recognizes several issues related to channel sharing
that were not resolved in the Commission's Channel Sharing Report and
Order, ET Docket No. 10-235, Report and Order, 27 FCC Rcd 4616 (2012).
For example, the Commission seeks comment on whether and when channel
sharing agreements (CSAs) should be filed with the Commission and
whether CSAs should be required to contain certain provisions
concerning access to, maintenance of, and modification of the shared
transmission facilities. The Commission also seeks comment on how to
resolve the use of termination of CSAs and whether all parties to a CSA
should be jointly responsible for compliance with certain of the
Commission's rules. Finally, the Commission proposes that the Spectrum
Act provision on preservation of cable and satellite carriage would not
affect the carriage rights of Class A stations. The Commission notes
that the resolution of these issues is important in order to provide
needed clarity to parties considering participating in the reverse
auction through a channel sharing bid.
32. In proposing terrestrial service rules for the 600 MHz band,
which include technical rules to protect against harmful interference,
and licensing rules to establish geographic license areas and spectrum
block sizes, we advance toward enabling widespread wireless broadband
deployment in the band. We do so by proposing service, technical,
assignment, and licensing rules for this spectrum that generally follow
the Commission's Part 27 rules that generally govern flexible use
terrestrial wireless service. For example, the Commission proposes: (1)
That the 600 MHz band may be used for any fixed or mobile service that
is consistent with the allocations for the band; (2) licensing the
spectrum under the flexible regulatory framework of Part 27 of the
rules; (3) allowing 600 MHz band licensees to provide both common
carrier and non-common carrier services (or switch between them) and to
request status as both a common carrier and a non-common carrier under
a single license; and (4) allowing 600 MHz licensees to provide all
allowable services anywhere within their licensed area at any time,
consistent with their regulatory status designated on their license
application. These proposals are designed to provide for flexible use
of this spectrum by allowing licensees to choose their type of service
offerings, to encourage innovation and investment in mobile broadband
use in this spectrum, and to provide a stable regulatory environment in
which broadband deployment would be able to develop through the
application of standard terrestrial wireless rules.
B. Legal Basis
33. The proposed action is authorized under Sections 4(i), 301,
302, 303(e), 303(f), 303(r) and 309(j) of the
[[Page 69977]]
Communications Act of 1934, as amended, 47 U.S.C. 154(i), 301, 302,
303(e), 303(f), 303(r) and 309(j).
C. Description and Estimate of the Number of Small Entities to Which
the Proposed Rules Will Apply
34. The RFA directs the Commission to provide a description of and,
where feasible, an estimate of the number of small entities that will
be affected by the proposed rules, if adopted.\7\ The RFA generally
defines the term ``small entity'' as having the same meaning as the
terms ``small business,'' small organization,'' and ``small government
jurisdiction.'' \8\ In addition, the term ``small business'' has the
same meaning as the term ``small business concern'' under the Small
Business Act.\9\ A small business concern is one which: (1) Is
independently owned and operated; (2) is not dominant in its field of
operation; and (3) satisfies any additional criteria established by the
SBA.\10\
---------------------------------------------------------------------------
\7\ Id. sec. 603(b)(3).
\8\ 5 U.S.C. 601(6).
\9\ Id. sec. 601(3) (incorporating by reference the definition
of ``small business concern'' in 15 U.S.C. 632). Pursuant to 5
U.S.C. 601(3), the statutory definition of a small business applies
``unless an agency, after consultation with the Office of Advocacy
of the Small Business Administration and after opportunity for
public comment, establishes one or more definitions of such term
which are appropriate to the activities of the agency and publishes
such definition(s) in the Federal Register.'' 5 U.S.C. 601(3).
\10\ 15 U.S.C. 632. Application of the statutory criteria of
dominance in its field of operation and independence are sometimes
difficult to apply in the context of broadcast television.
Accordingly, the Commission's statistical account of television
stations may be over-inclusive.
---------------------------------------------------------------------------
35. Television Broadcasting. This Economic Census category
``comprises establishments primarily engaged in broadcasting images
together with sound. These establishments operate television
broadcasting studios and facilities for the programming and
transmission of programs to the public.'' \11\ The SBA has created the
following small business size standard for Television Broadcasting
firms: those having $14 million or less in annual receipts.\12\ The
Commission has estimated the number of licensed commercial television
stations to be 1,384.\13\ In addition, according to Commission staff
review of the BIA Advisory Services, LLC's Media Access Pro Television
Database on March 28, 2012, about 950 of an estimated 1,300 commercial
television stations (or approximately 73 percent) had revenues of $14
million or less.\14\ We therefore estimate that the majority of
commercial television broadcasters are small entities.
---------------------------------------------------------------------------
\11\ U.S. Census Bureau, 2007 NAICS Definitions, ``515120
Television Broadcasting'' (partial definition); http://www.census.gov/naics/2007/def/ND515120.HTM#N515120.
\12\ 13 CFR 121.201, NAICS code 515120 (updated for inflation in
2010).
\13\ See FCC News Release, ``Broadcast Station Totals as of June
30, 2012,'' dated July 19, 2012; http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-315231A1.pdf.
\14\ We recognize that BIA's estimate differs slightly from the
FCC total given supra.
---------------------------------------------------------------------------
36. We note, however, that in assessing whether a business concern
qualifies as small under the above definition, business (control)
affiliations \15\ must be included. Our estimate, therefore, likely
overstates the number of small entities that might be affected by our
action because the revenue figure on which it is based does not include
or aggregate revenues from affiliated companies. In addition, an
element of the definition of ``small business'' is that the entity not
be dominant in its field of operation. We are unable at this time to
define or quantify the criteria that would establish whether a specific
television station is dominant in its field of operation. Accordingly,
the estimate of small businesses to which rules may apply does not
exclude any television station from the definition of a small business
on this basis and is therefore possibly over-inclusive to that extent.
---------------------------------------------------------------------------
\15\ ``[Business concerns] are affiliates of each other when one
concern controls or has the power to control the other or a third
party or parties controls or has to power to control both.'' 13 CFR
21.103(a)(1).
---------------------------------------------------------------------------
37. In addition, the Commission has estimated the number of
licensed noncommercial educational (NCE) television stations to be
396.\16\ These stations are non-profit, and therefore considered to be
small entities.\17\
---------------------------------------------------------------------------
\16\ See FCC News Release, ``Broadcast Station Totals as of June
30, 2012,'' dated July 19, 2012; http://transition.fcc.gov/Daily_Releases/Daily_Business/2012/db0106/DOC-315231A1.pdf.
\17\ See generally 5 U.S.C. 601(4), (6).
---------------------------------------------------------------------------
38. In addition, there are also 2,466 low power television
stations, including Class A stations and 4,176 television translator
stations.\18\ Given the nature of these services, we will presume that
all of these entities qualify as small entities under the above SBA
small business size standard.
---------------------------------------------------------------------------
\18\ See FCC News Release, ``Broadcast Station Totals as of June
30, 2012,'' dated July 19, 2012; http://transition.fcc.gov/Daily_Releases/Daily_Business/2012/db0106/DOC-315231A1.pdf.
---------------------------------------------------------------------------
39. Cable Television Distribution Services. Since 2007, these
services have been defined within the broad economic census category of
Wired Telecommunications Carriers; that category is defined as follows:
``This industry comprises establishments primarily engaged in operating
and/or providing access to transmission facilities and infrastructure
that they own and/or lease for the transmission of voice, data, text,
sound, and video using wired telecommunications networks. Transmission
facilities may be based on a single technology or a combination of
technologies.'' \19\ The SBA has developed a small business size
standard for this category, which is: all such firms having 1,500 or
fewer employees. Census data for 2007 shows that there were 1,383 firms
that operated that year.\20\ Of those 1,383, 1,368 had fewer than 100
employees, and 15 firms had more than 100 employees. Thus under this
category and the associated small business size standard, the majority
of such firms can be considered small.
---------------------------------------------------------------------------
\19\ U.S. Census Bureau, 2007 NAICS Definitions, 517110 Wired
Telecommunications Carriers, (partial definition), http://www.census.gov/naics/2007/def/ND517110.HTM#N517110 (last visited
Oct. 21, 2009).
\20\ U.S. Census Bureau, 2007 Economic Census, Sector 51, 2007
NAICS code 517210 (rel. Oct. 20, 2009), http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=700&-ds_name=EC0751SSSZ5&-_lang=en.
---------------------------------------------------------------------------
40. Cable Companies and Systems. The Commission has also developed
its own small business size standards, for the purpose of cable rate
regulation. Under the Commission's rules, a ``small cable company'' is
one serving 400,000 or fewer subscribers, nationwide.\21\ Industry data
indicate that, of 1,076 cable operators nationwide, all but eleven are
small under this size standard.\22\ In addition, under the Commission's
rules, a ``small system'' is a cable system serving 15,000 or fewer
subscribers.\23\ Industry data indicate that, of 6,635 systems
nationwide, 5,802 systems have under 10,000 subscribers, and an
additional 302 systems have 10,000-19,999 subscribers.\24\ Thus, under
this second size standard, most cable systems are small.
---------------------------------------------------------------------------
\21\ 47 CFR 76.901(e). The Commission determined that this size
standard equates approximately to a size standard of $100 million or
less in annual revenues. Implementation of Sections of the 1992
Cable Act: Rate Regulation, Sixth Report and Order and Eleventh
Order on Reconsideration, 10 FCC Rcd 7393, 7408 (1995).
\22\ These data are derived from: R.R. Bowker, Broadcasting &
Cable Yearbook 2006, ``Top 25 Cable/Satellite Operators,'' pages A-8
& C-2 (data current as of June 30, 2005); Warren Communications
News, Television & Cable Factbook 2006, ``Ownership of Cable Systems
in the United States,'' pages D-1805 to D-1857.
\23\ 47 CFR 76.901(c).
\24\ Warren Communications News, Television & Cable Factbook
2008, ``U.S. Cable Systems by Subscriber Size,'' page F-2 (data
current as of Oct. 2007). The data do not include 851 systems for
which classifying data were not available.
---------------------------------------------------------------------------
41. Cable System Operators. The Communications Act of 1934, as
amended, also contains a size standard
[[Page 69978]]
for small cable system operators, which is ``a cable operator that,
directly or through an affiliate, serves in the aggregate fewer than 1
percent of all subscribers in the United States and is not affiliated
with any entity or entities whose gross annual revenues in the
aggregate exceed $250,000,000.'' \25\ The Commission has determined
that an operator serving fewer than 677,000 subscribers shall be deemed
a small operator, if its annual revenues, when combined with the total
annual revenues of all its affiliates, do not exceed $250 million in
the aggregate.\26\ Industry data indicate that, of 1,076 cable
operators nationwide, all but ten are small under this size
standard.\27\ We note that the Commission neither requests nor collects
information on whether cable system operators are affiliated with
entities whose gross annual revenues exceed $250 million,\28\ and
therefore we are unable to estimate more accurately the number of cable
system operators that would qualify as small under this size standard.
---------------------------------------------------------------------------
\25\ 47 U.S.C. 543(m)(2); see 47 CFR 76.901(f) & nn. 1-3.
\26\ 47 CFR 76.901(f); see Public Notice, FCC Announces New
Subscriber Count for the Definition of Small Cable Operator, DA 01-
158 (Cable Services Bureau, Jan. 24, 2001).
\27\ These data are derived from: R.R. Bowker, Broadcasting &
Cable Yearbook 2006, ``Top 25 Cable/Satellite Operators,'' pages A-8
& C-2 (data current as of June 30, 2005); Warren Communications
News, Television & Cable Factbook 2006, ``Ownership of Cable Systems
in the United States,'' pages D-1805 to D-1857.
\28\ The Commission does receive such information on a case-by-
case basis if a cable operator appeals a local franchise authority's
finding that the operator does not qualify as a small cable operator
pursuant to section 76.901(f) of the Commission's rules. See 47 CFR
76.909(b).
---------------------------------------------------------------------------
42. Direct Broadcast Satellite (``DBS'') Service. DBS service is a
nationally distributed subscription service that delivers video and
audio programming via satellite to a small parabolic ``dish'' antenna
at the subscriber's location. DBS, by exception, is now included in the
SBA's broad economic census category, ``Wired Telecommunications
Carriers,'' \29\ which was developed for small wireline firms. Under
this category, the SBA deems a wireline business to be small if it has
1,500 or fewer employees.\30\ To gauge small business prevalence for
the DBS service, the Commission relies on data currently available from
the U.S. Census for the year 2007. According to that source, there were
3,188 firms that in 2007 were Wired Telecommunications Carriers. Of
these, 3,144 operated with less than 1,000 employees, and 44 operated
with more than 1,000 employees. However, as to the latter 44 there is
no data available that shows how many operated with more than 1,500
employees. Based on this data, the majority of these firms can be
considered small.\31\ Currently, only two entities provide DBS service,
which requires a great investment of capital for operation: DIRECTV and
EchoStar Communications Corporation (``EchoStar'') (marketed as the
DISH Network).\32\ Each currently offers subscription services. DIRECTV
\33\ and EchoStar \34\ each report annual revenues that are in excess
of the threshold for a small business. Because DBS service requires
significant capital, we believe it is unlikely that a small entity as
defined by the SBA would have the financial wherewithal to become a DBS
service provider.
---------------------------------------------------------------------------
\29\ See 13 CFR 121.201, NAICS code 517110 (2007). The 2007
NAICS definition of the category of ``Wired Telecommunications
Carriers'' is cited above.
\30\ 13 CFR 121.201, NAICS code 517110 (2007).
\31\ See http://www.factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=600&-ds_name=EC0751SSSZ5&-_lang=en.
\32\ See Annual Assessment of the Status of Competition in the
Market for the Delivery of Video Programming, Thirteenth Annual
Report, 24 FCC Rcd 542, 580, para. 74 (2009) (``13th Annual
Report''). We note that, in 2007, EchoStar purchased the licenses of
Dominion Video Satellite, Inc. (``Dominion'') (marketed as Sky
Angel). See Public Notice, ``Policy Branch Information; Actions
Taken,'' Report No. SAT-00474, 22 FCC Rcd 17776 (IB 2007).
\33\ As of June 2006, DIRECTV is the largest DBS operator and
the second largest MVPD, serving an estimated 16.20% of MVPD
subscribers nationwide. See 13th Annual Report, 24 FCC Rcd at 687,
Table B-3.
\34\ As of June 2006, DISH Network is the second largest DBS
operator and the third largest MVPD, serving an estimated 13.01% of
MVPD subscribers nationwide. Id. As of June 2006, Dominion served
fewer than 500,000 subscribers, which may now be receiving ``Sky
Angel'' service from DISH Network. See id. at 581, para. 76.
---------------------------------------------------------------------------
43. Cable and Other Subscription Programming. This industry
comprises establishments primarily engaged in operating studios and
facilities for the broadcasting of programs on a subscription or fee
basis. The broadcast programming is typically narrowcast in nature
(e.g., limited format, such as news, sports, education, or youth-
oriented). These establishments produce programming in their own
facilities or acquire programming. The programming material is usually
delivered to a third party, such as cable systems or direct-to-home
satellite systems, for transmission to viewers.\35\ The SBA size
standard for this industry establishes \36\ as small any company in
this category which receives annual receipts of $15 million or less.
Based on U.S. Census data for 2007, in that year 469 establishments
operated for the entire year. Of that 659, 197 operated with annual
receipts of $10 million a year or more. The remaining 462
establishments operated with annual receipts of less than $10 million.
Based on this date, the Commission estimates that the majority of
establishments operating in this industry is small.\37\
---------------------------------------------------------------------------
\35\ http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=515210&search=2007.
\36\ See 13 CFR 121.201, NAICS Code 515210.
\37\ http://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_51SSSZ1&prodType=table.
---------------------------------------------------------------------------
44. Radio and Television Broadcasting and Wireless Communications
Equipment Manufacturing. The Census Bureau defines this category as
follows: ``This industry comprises establishments primarily engaged in
manufacturing radio and television broadcast and wireless
communications equipment. Examples of products made by these
establishments are: transmitting and receiving antennas, cable
television equipment, GPS equipment, pagers, cellular phones, mobile
communications equipment, and radio and television studio and
broadcasting equipment.'' \38\ The SBA has developed a small business
size standard for Radio and Television Broadcasting and Wireless
Communications Equipment Manufacturing, which is: all such firms having
750 or fewer employees. According to Census Bureau data for 2007, there
were a total of 939 establishments in this category that operated for
part or all of the entire year. According to Census bureau data for
2007, there were a total of 939 firms in this category that operated
for the entire year. Of this total, 912 had less than 500 employees and
17 had more than 1000 employees.\39\ Thus, under that size standard,
the majority of firms can be considered small.
---------------------------------------------------------------------------
\38\ The NAICS Code for this service 334220. See 13 CFR 121/201.
See also http://factfinder.census.gov/servlet/IBQTable?_bm=y&-fds_name=EC0700A1&-geo_id=&-_skip=300&-ds_name=EC0731SG2&-_lang=en.
\39\ http://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_31SA11&prodType=table.
---------------------------------------------------------------------------
45. Audio and Video Equipment Manufacturing. The SBA has classified
the manufacturing of audio and video equipment under in NAICS Codes
classification scheme as an industry in which a manufacturer is small
if it has less than 750 employees.\40\ Data contained in the 2007 U.S.
Census indicate that 491 establishments operated in that industry for
all or part of that year. In that year, 456 establishments had 99
employees or less; and 35 had more than 100
[[Page 69979]]
employees.\41\ Thus, under the applicable size standard, a majority of
manufacturers of audio and video equipment may be considered small.
---------------------------------------------------------------------------
\40\ 13 CFR 121.201, NAICS Code 334310.
\41\ http://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_31I1&prodType=table.
---------------------------------------------------------------------------
46. Wireless Telecommunications Carriers (except satellite). This
industry comprises establishments engaged in operating and maintaining
switching and transmission facilities to provide communications via the
airwaves. Establishments in this industry have spectrum licenses and
provide services using that spectrum, such as cellular phone services,
paging services, wireless Internet access, and wireless video
services.\42\ The appropriate size standard under SBA rules is for the
category Wireless Telecommunications Carriers. The size standard for
that category is that a business is small if it has 1,500 or fewer
employees.\43\ Under the present and prior categories, the SBA has
deemed a wireless business to be small if it has 1,500 or fewer
employees.\44\ For this category, census data for 2007 show that there
were 11,163 firms that operated for the entire year.\45\ Of this total,
10,791 firms had employment of 999 or fewer employees and 372 had
employment of 1000 employees or more.\46\ Thus under this category and
the associated small business size standard, the Commission estimates
that the majority of wireless telecommunications carriers (except
satellite) are small entities that may be affected by our proposed
action.\47\
---------------------------------------------------------------------------
\42\ http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=517210&search=2007%20NAICS%20Search.
\43\ 13 CFR 121.201, NAICS code 517210.
\44\ 13 CFR 121.201, NAICS code 517210. The now-superseded, pre-
2007 CFR citations were 13 CFR 121.201, NAICS codes 517211 and
517212 (referring to the 2002 NAICS).
\45\ U.S. Census Bureau, Subject Series: Information, Table 5,
``Establishment and Firm Size: Employment Size of Firms for the
United States: 2007 NAICS Code 517210'' (issued Nov. 2010).
\46\ Id. Available census data do not provide a more precise
estimate of the number of firms that have employment of 1,500 or
fewer employees; the largest category provided is for firms with
``100 employees or more.''
\47\ See http://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_51SSSZ2&prodType=table.
---------------------------------------------------------------------------
47. Fixed Microwave Services. Microwave services include common
carrier,\48\ private-operational fixed,\49\ and broadcast auxiliary
radio services.\50\ At present, there are approximately 31,549 common
carrier fixed licensees and 89,633 private and public safety
operational-fixed licensees and broadcast auxiliary radio licensees in
the microwave services. Microwave services include common carrier,\51\
private-operational fixed,\52\ and broadcast auxiliary radio
services.\53\ They also include the Local Multipoint Distribution
Service (LMDS),\54\ the Digital Electronic Message Service (DEMS),\55\
and the 24 GHz Service,\56\ where licensees can choose between common
carrier and non-common carrier status.\57\ The appropriate size
standard under SBA rules is for the category Wireless
Telecommunications Carriers (except satellite). The size standard for
that category is that a business is small if it has 1,500 or fewer
employees.\58\ Under the present and prior categories, the SBA has
deemed a wireless business to be small if it has 1,500 or fewer
employees.\59\ For this category, census data for 2007 show that there
were 11,163 firms that operated for the entire year.\60\ Of this total,
10,991 firms had employment of 99 or fewer employees and 372 had
employment of 1000 employees or more.\61\ Thus under this category and
the associated small business size standard, the Commission estimates
that the majority of wireless telecommunications carriers (except
satellite) are small entities that may be affected by our proposed
action.\62\
---------------------------------------------------------------------------
\48\ 47 CFR Part 101 et seq. (formerly, part 21 of the
Commission's Rules) for common carrier fixed microwave services
(except MDS).
\49\ Persons eligible under Parts 80 and 90 of the Commission's
rules can use Private-Operational Fixed Microwave services. See 47
CFR Parts 80 and 90. Stations in this service are called
operational-fixed to distinguish them from common carrier and public
fixed stations. Only the licensee may use the operational-fixed
station, and only for communications related to the licensee's
commercial, industrial, or safety operations.
\50\ Auxiliary Microwave Service is governed by Part 74 and Part
78 of Title 47 of the Commission's Rules. Available to licensees of
broadcast stations, cable operators, and to broadcast and cable
network entities. Auxiliary microwave stations are used for relaying
broadcast television signals from the studio to the transmitter, or
between two points such as a main studio and an auxiliary studio.
The service also includes TV pickup and CARS pickup, which relay
signals from a remote location back to the studio.
\51\ See 47 CFR part 101, subparts C and I.
\52\ See 47 CFR part 101, subparts C and H.
\53\ Auxiliary Microwave Service is governed by Part 74 of Title
47 of the Commission's Rules. See 47 CFR part 74. Available to
licensees of broadcast stations and to broadcast and cable network
entities, broadcast auxiliary microwave stations are used for
relaying broadcast television signals from the studio to the
transmitter or between two points such as a main studio and an
auxiliary studio. The service also includes mobile TV pickups, which
relay signals from a remote location back to the studio.
\54\ See 47 CFR part 101, subpart L.
\55\ See 47 CFR part 101, subpart G.
\56\ See id.
\57\ See 47 CFR 101.533, 101.1017.
\58\ 13 CFR 121.201, NAICS code 517210.
\59\ 13 CFR 121.201, NAICS code 517210. The now-superseded, pre-
2007 CFR citations were 13 CFR 121.201, NAICS codes 517211 and
517212 (referring to the 2002 NAICS).
\60\ U.S. Census Bureau, Subject Series: Information, Table 5,
``Establishment and Firm Size: Employment Size of Firms for the
United States: 2007 NAICS Code 517210'' (issued Nov. 2010).
\61\ Id. Available census data do not provide a more precise
estimate of the number of firms that have employment of 1,500 or
fewer employees; the largest category provided is for firms with
``100 employees or more.''
\62\ See http://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_51SSSZ2&prodType=table.
---------------------------------------------------------------------------
48. Manufacturers of unlicensed devices. In the context of this
IRFA, manufacturers of Part 15 unlicensed devices that are operated in
the UHF-TV band (channels 14-51) involve wi-fi services used in
wireless data transfer and as such fall into the category of Radio and
Television and Wireless Communications Equipment Manufacturing. The
Census Bureau defines this category as follows: ``This industry
comprises establishments primarily engaged in manufacturing radio and
television broadcast and wireless communications equipment. Examples of
products made by these establishments are: transmitting and receiving
antennas, cable television equipment, GPS equipment, pagers, cellular
phones, mobile communications equipment, and radio and television
studio and broadcasting equipment.'' \63\ The SBA has developed a small
business size standard for this category, which is: all such firms
having 750 or fewer employees. According to Census Bureau data for
2007, there were a total of 939 firms in this category that operated
for the entire year. Of this total, 912 had less than 500 employees and
17 had more than 1000 employees.\64\ Thus, under that size standard,
the majority of firms can be considered small.
---------------------------------------------------------------------------
\63\ The NAICS Code for this service 334220. See 13 CFR 121/201.
See also http://factfinder.census.gov/servlet/IBQTable?_bm=y&-fds_name=EC0700A1&-geo_id=&-_skip=300&-ds_name=EC0731SG2&-_lang=en.
\64\ See http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-_skip=4500&-ds_name=EC0731SG3&-_lang=en.
---------------------------------------------------------------------------
49. Personal Radio Services/Wireless Medical Telemetry Service
(``WMTS'').
Personal radio services provide short-range, low power radio for
personal communications, radio signaling, and business communications
not provided for in other services. The Personal Radio Services include
spectrum licensed under Part 95 of our rules.\65\ These services
include Citizen Band Radio Service (``CB''), General Mobile Radio
Service (``GMRS''), Radio Control Radio Service (``R/C''), Family Radio
Service (``FRS''), Wireless Medical Telemetry Service (``WMTS''),
Medical Implant
[[Page 69980]]
Communications Service (``MICS''), Low Power Radio Service (``LPRS''),
and Multi-Use Radio Service (``MURS'').\66\ There are a variety of
methods used to license the spectrum in these rule parts, from
licensing by rule, to conditioning operation on successful completion
of a required test, to site-based licensing, to geographic area
licensing. Under the RFA, the Commission is required to make a
determination of which small entities are directly affected by the
rules being proposed. Since all such entities are wireless, we apply
the definition of Wireless Telecommunications Carriers (except
Satellite), pursuant to which a small entity is defined as employing
1,500 or fewer persons.\67\ For this category, census data for 2007
show that there were 11,163 firms that operated for the entire
year.\68\ Of this total, 10,791 firms had employment of 999 or fewer
employees and 372 had employment of 1000 employees or more.\69\ Thus
under this category and the associated small business size standard,
the Commission estimates that the majority of wireless
telecommunications carriers (except satellite) are small entities.
---------------------------------------------------------------------------
\65\ 47 CFR part 90.
\66\ The Citizens Band Radio Service, General Mobile Radio
Service, Radio Control Radio Service, Family Radio Service, Wireless
Medical Telemetry Service, Medical Implant Communications Service,
Low Power Radio Service, and Multi-Use Radio Service are governed by
subpart D, subpart A, subpart C, subpart B, subpart H, subpart I,
subpart G, and subpart J, respectively, of part 95 of the
Commission's rules. See generally 47 CFR part 95.
\67\ 13 CFR 121.201, NAICS Code 517210.
\68\ U.S. Census Bureau, Subject Series: Information, Table 5,
``Establishment and Firm Size: Employment Size of Firms for the
United States: 2007 NAICS Code 517210'' (issued Nov. 2010).
\69\ Id. Available census data do not provide a more precise
estimate of the number of firms that have employment of 1,500 or
fewer employees; the largest category provided is for firms with
``100 employees or more.''
---------------------------------------------------------------------------
50. However, we note that many of the licensees in these services
are individuals, and thus are not small entities. In addition, due to
the mostly unlicensed and shared nature of the spectrum utilized in
many of these services, the Commission lacks direct information upon
which to base a more specific estimation of the number of small
entities under an SBA definition that might be directly affected by our
action.
51. Aeronautical Mobile Telemetry (``AMT'') Currently there are 9
AMT licenses in the 2360-2395 MHz band. It is unclear how many of these
will be affected by our new rules. The Commission has not yet defined a
small business with respect to aeronautical mobile telemetry services.
For purposes of this analysis, the Commission applies the definition of
Wireless Telecommunications Carriers (except Satellite), pursuant to
which a small entity is defined as employing 1,500 or fewer
persons.\70\ For this category, census data for 2007 show that there
were 11,163 firms that operated for the entire year.\71\ Of this total,
10,791 firms had employment of 999 or fewer employees and 372 had
employment of 1000 employees or more.\72\ Thus under this category and
the associated small business size standard, the Commission estimates
that the majority of wireless telecommunications carriers (except
satellite) are small entities. The rules we adopt provide the
flexibility to manufacturers, licensees and coordinators needed to
accommodate changes in both AMT and Medical Body Area Network (MBAN)
operations and to provide assurance to AMT users that their future
access to the spectrum will not be hampered.\73\
---------------------------------------------------------------------------
\70\ 13 CFR 121.201, NAICS Code 517210.
\71\ U.S. Census Bureau, Subject Series: Information, Table 5,
``Establishment and Firm Size: Employment Size of Firms for the
United States: 2007 NAICS Code 517210'' (issued Nov. 2010).
\72\ Id. Available census data do not provide a more precise
estimate of the number of firms that have employment of 1,500 or
fewer employees; the largest category provided is for firms with
``100 employees or more.''
\73\ See In The Matter of Amendment of The Commission's Rules to
Provide Spectrum for the Operation of Medical Body Area Networks, ET
Docket 08-59, 27 FCC Rcd. 6422, para 9 (2012).
---------------------------------------------------------------------------
52. Radio Astronomy. The Commission has not developed a definition
for radio astronomy. However the SBA has established a category into
which Radio Astronomy fits, which is: All Other Telecommunications.\74\
This U.S. industry comprises establishments primarily engaged in
providing specialized telecommunications services, such as satellite
tracking, communications telemetry, and radar station operation. This
industry also includes establishments primarily engaged in providing
satellite terminal stations and associated facilities connected with
one or more terrestrial systems and capable of transmitting
telecommunications to, and receiving telecommunications from, satellite
systems. Establishments providing Internet services or voice over
Internet protocol (VoIP) services via client-supplied
telecommunications connections are also included in this industry.\75\
The size standard for all establishments engaged in this industry is
that annual receipts of $25 million or less establish the firm as
small.\76\ Based on data in the 2007 U.S. Census, in 2007 there were
2,263 establishments that operated in the All Other Telecommunications
category. Of that 2,263, 145 establishments operated with annual
receipts of more than $10 million per year. The remaining 2,118
establishments operated with annual receipts of less than $10 million
per year.\77\ Based on this data, the Commission estimates that the
majority of establishments in the All Other Telecommunications category
are small.
---------------------------------------------------------------------------
\74\ 13 CFR 121.202, NAICS Code 517919.
\75\ http://www.census.gov/cgi-bin/sssd/naics/naicsrch.
\76\ http://www.census.gov/cgi-bin/sssd/naics/naicsrch.
\77\ http://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_51SSSZ1&prodType=table.
---------------------------------------------------------------------------
D. Description of Projected Reporting, Recordkeeping and Other
Compliance Requirements
53. The NPRM proposes the following new or revised reporting or
recordkeeping requirements.
54. In this NPRM, the Commission seeks comment on various
reporting, record-keeping, and other compliance requirements for the
parties that will participate in the broadcast television spectrum
incentive auction. The Commission proposes, for example, that a
television broadcaster interested in participating in the reverse
auction component of the incentive auction process, whereby the
broadcaster can offer to relinquish some or all of its spectrum usage
rights in exchange for an incentive payment, must disclose certain
information, such as its ownership, before becoming qualified to
participate in the auction. In addition, the Commission asks whether a
broadcaster that may offer to relinquish some of its spectrum usage
rights and subsequently enter into a channel-sharing agreement, should
be required to provide information regarding the channel sharing
agreement, possibly including the channel sharing agreement itself.
55. The Commission also seeks comment on compliance requirements
that will affect the parties interested in participating in the
broadcast television spectrum incentive auction in order to obtain new
licenses for the 600 MHz spectrum. The Commission proposes, for
example, that a party interested in participating in the forward
auction component of the incentive auction process, whereby the party
may bid on such licenses, must disclose certain information, such as
their ownership, before becoming qualified to participate in the
auction.
56. Participants in both the reverse and the forward auction will
also be required to report changes to information in their applications
and any potential violations of the Commission's prohibition on certain
[[Page 69981]]
communications relating to the auction process. In addition, any
participant that has a bid for relinquishing spectrum usage rights or
for a new license accepted will have additional reporting, record-
keeping, and compliance requirements.
57. Because the overall design of the broadcast incentive auction
has not been finalized, we do not yet have a more specific estimate of
potential reporting, recordkeeping, and compliance burdens on small
businesses. The Commission anticipates that commenters will address the
reporting, record-keeping, and other compliance proposals made in the
NPRM, and will provide reliable information on any costs or burdens on
small businesses for inclusion in the record of this proceeding.
58. As it did with respect to reverse auction bids by Class A
stations, the Commission also proposes that Class A stations be
required to elect which facilities they would like protected in
repacking. The Media Bureau will issue a Public Notice outlining the
procedures for Class A stations to make their elections.
59. The Commission proposed that full power television stations,
Class A television stations and MVPDs that qualify for reimbursement of
the expenses incurred in repacking have the option of submitting a
filing demonstrating their actual expenses and later be required to
report on whether all reimbursement funds were properly dispensed.
Alternatively, the Commission proposes to advance payments to stations
and MVPDs based on estimated amounts and without first requiring
documentation. This was proposed to ease the burden on stations and
MVPDs and to expedite the reimbursement process.
60. Stations whose channel assignments are changed as a result of
the reverse auction or repacking will be required to submit an
application for construction permit or license to implement their
channel change. The Commission proposes a simplified, one-step process
for implementing the post-auction and post-repacking channel changes.
Rather than require stations to go through a prolonged two-step process
of first amending the DTV Table of Allotments and then filing an
application for its repacked facilities, the Commission is proposing
simply to allow stations to file either a license application (for
stations where no technical changes are proposed such as channel
sharing) or a minor change application. The Commission proposes to
expedite the processing of ``check list'' type applications that
certify compliance with the technical rules and no substantial changes
to their modified facilities. The streamlined procedures are meant to
expedite the post auction licensing and to ensure a smooth post-auction
transition and recovery of channels.
61. Stations that need additional time to relocate to their new
channel assignments may be required to submit a request for extension
of time (FCC Form 337), for tolling (informal filing) or for Special
Temporary Authority (STA--informal filing).
62. The Commission proposes that all stations changing channel
assignments as a result of the reverse auction or repacking be required
to conduct consumer education including airing viewer notifications and
submitting a report to the Commission on their consumer education
efforts. The reports would be filed on existing FCC Form 388 (that was
utilized for consumer education during the digital television
transition) revised for use with the band transition. In addition, the
Commission proposes that all stations changing channel assignments
provide notice to MVPDs so that MVPDs can make the necessary changes to
their channel lineups.
63. LPTV stations displaced as a result of repacking may be
permitted to submit a displacement application (FCC Form 346). In
addition to preparing and filing the application, the station may also
be required to submit a new showing that it qualifies for priorities
that will enable its application to be selected from a mutually
exclusive group. It is expected that this requirement will have a
greater effect on small entities because all LPTVs are small entities.
64. The Commission proposes that channel sharing bidders may be
required to submit their channel sharing agreements (CSAs) with the
Commission and be required to include certain provisions in their CSAs.
65. All 600 MHz licensees would be required to file a construction
notification and certify that they have met any applicable performance
benchmark.\78\ They will also be required to file a license renewal
application.\79\ In addition, a 600 MHz licensee must notify the
Commission of certain changes. Specifically, notification is required
by licensees if they change their regulatory status,\80\ their foreign
ownership status,\81\ or if they permanently discontinue service.\82\
Finally, 600 MHz licensees, along with TV broadcasters in the 470-698
MHz band, would need to provide thirty days' notice to all incumbent
fixed BAS operations within interference range prior to commencing
operations in the vicinity.\83\
---------------------------------------------------------------------------
\78\ See 47 CFR 1.946(d).
\79\ See 47 CFR 1.949.
\80\ See 47 CFR 27.10(d); see also 47 CFR 27.66. A change in a
licensee's regulatory status would not require prior Commission
authorization, provided the licensee was in compliance with the
foreign ownership requirements of Section 310(b) of the
Communications Act that would apply as a result of the change. 47
U.S.C. 310(b).
\81\ 47 U.S.C. 310(b).
\82\ The licensee must notify the Commission of the
discontinuance within 10 days by filing FCC Form 601 or 605 and
requesting license cancellation.
\83\ See, e.g., 47 CFR 101.103(d) (30-day coordination ``notice
and wait'' requirement).
---------------------------------------------------------------------------
E. Steps Taken To Minimize Significant Impact on Small Entities, and
Significant Alternatives Considered
66. The RFA requires an agency to describe any significant
alternatives that it has considered in reaching its proposed approach,
which may include the following four alternatives (among others): (1)
The establishment of differing compliance or reporting requirements or
timetables that take into account the resources available to small
entities; \84\ (2) the clarification, consolidation, or simplification
of compliance or reporting requirements under the rule for small
entities; (3) the use of performance, rather than design, standards;
and (4) an exemption from coverage of the rule, or any part thereof,
for small entities.\85\
---------------------------------------------------------------------------
\84\ We note that all references to small entities in this IRFA
apply also to minority-and women-owned small businesses.
\85\ 5 U.S.C. 603(c)(1)-(c)(4).
---------------------------------------------------------------------------
67. The proposed auction design and competitive bidding rules for
the reverse auction resulting from the NPRM will apply to all entities
in the same manner. Full power television and Class A stations will be
permitted to participate in the reverse auction and the forward auction
will be open to all entities. The Commission proposes changes to its
Part 1 rules to deal with special issues that arise in the unique
incentive auction process. For example, the Commission must consider
the requirement of mutual exclusivity in the context of the broadcast
television spectrum forward auction. Specifically, if the spectrum to
be offered in the forward auction consists of generic (non-frequency-
specific) blocks, how should the Commission determine whether mutual
exclusivity exists? In addition, the Commission asks commenters to
address whether applications to participate in the reverse and forward
auctions are ``mutually exclusive applications'' for ``initial
license[s]'' since the reverse and forward auction applicants will
submit
[[Page 69982]]
bids relating to mutually exclusive spectrum usage rights (i.e., the
spectrum currently used by broadcast television licensees). With
respect to bidding credits for the forward auction, the Commission
seeks comment on the use of certain size standards and associated
bidding credits for applicants to be licensed in the forward auction
with particular focus on the appropriate definitions of small and very
small businesses as they relate to the size of the geographic area to
be covered and the spectrum allocated to each license. In the reverse
auction, the Commission seeks comment on the Spectrum Act statutory
provision requiring the Commission to take all reasonable steps
necessary to protect the confidentiality of Commission-held data of a
licensee participating in the reverse auction, including withholding
the identity of such licensee. With respect to all proposed changes to
the Part 1 rules, the Commission will apply them uniformly to all
entities that choose to participate in spectrum license auctions,
including the forward auction. The Commission believes that applying
the same rules equally to all entities in these contexts promotes
fairness. The Commission does not believe that the limited costs and/or
administrative burdens associated with the rules or the proposed
auction design will unduly burden small entities.
68. The proposed auction design and competitive bidding rules
provide small businesses flexibility with respect to the ways in which
they may participate in the reverse auction. For example, the NPRM
proposes to allow a broadcast television licensee to relinquish some or
all of its spectrum usage rights in at least three different ways: (1)
It may relinquish all of its spectrum usage rights with respect to a
particular television channel without receiving in return any usage
rights with respect to another television channel; (2) it may
relinquish spectrum usage rights in a UHF channel in return for
receiving spectrum usage rights in a VHF channel; or (3) it may
relinquish its spectrum usage rights in order to share a television
channel with another licensee.
69. In addition, the NPRM recognizes the potential competitive
sensitivities related to the information provided by licensees
participating in the reverse auction either by submitting bids to exit
an ongoing business, or by making significant changes to that business
(e.g., by sharing or changing the channels on which they operate).
Specifically, as required by section 6403(a)(3) of the Spectrum Act,
the NPRM proposes to take steps to protect the confidentiality of
Commission-held data of licensees participating in the reverse auction,
including the licensees' identities.
70. In the NPRM, and in paragraph 6 of this IRFA, the Commission
sought comment on its proposed size standards which define a ``small
business'' as an entity with annual average revenues of $40 million
over the previous three years; and which define a ``very small
business'' as an entity with an annual average revenues of $15 million
over the previous three years. In the NPRM and in this IRFA, the
Commission also sought comment on providing small businesses with a
bidding credit of 15 percent and on providing very small businesses
with a bidding credit of 25 percent. We believe these proposals will
provide an economic benefit to small entities by making it easier to
acquire spectrum licenses or to access spectrum through secondary
markets.
71. The proposal to limit reverse auction participation to only
full power and Class A stations and to not permit participation by low
power television stations will have a greater impact on small entities
since all low power television stations are small entities.
Alternatively, the Commission could allow low power television stations
to participate in the reverse auction but this would have no practical
use since low power television stations do not have to be protected in
repacking and clearing them from their channels in the reverse auction
would be unnecessary. The Commission believes the additional burden on
low power stations is outweighed by the need to implement Spectrum Act
provisions, to recover a sufficient amount of spectrum in the reverse
auction and to complete the successful repacking full power and Class A
stations.\86\
---------------------------------------------------------------------------
\86\ As noted in paragraph 0, the Commission has asked for
comment on establishing priorities applicable to displacement
applications filed by LPTVs, many of which may be owned by small,
minority and women applicants.
---------------------------------------------------------------------------
72. In order to minimize the impact of the incentive auction and
repacking processes on noncommercial educational (NCE) television
stations, all of which are small entities, the Commission allowed these
stations to participate in the incentive auction. It is expected that
participation in the reverse auction will benefit small entities like
NCEs by allowing them to strengthen their financial position through
the use of auction proceeds. The Commission has decided to not bar NCEs
from participating because that could limit the number of channels
recovered in the reverse auction and thus negatively affect the outcome
of the incentive auction process.
73. The NPRM proposes that entities with construction permits be
allowed to participate in the reverse auction if they become licensees
before the deadline for submission of the application to participate in
the auction. This would require stations with unbuilt facilities to
complete construction of their stations and seek a license prior to
participating in the reverse auction. In addition, for a new station
permittee not licensed on February 22, 2012 (but auction eligible
because it becomes licensed by the pre-auction application filing
deadline), the Commission proposes to evaluate its bid based on the
spectrum usage rights authorized in the construction permit it held on
February 22, 2012. There are only very few entities in this category,
and all are full power television stations. Therefore, the proposal
would have little adverse, if any, impact and would affect all entities
equally.
74. For the reverse auction bidding, it is proposed that the
Commission only examine the spectrum usage rights held by stations in
their licenses as of February 22, 2012. All stations will be subject to
this policy, and therefore, it is not expected to have a significant
impact on small entities and, in any case, the impact would affect all
entities equally.
75. The Commission's proposal to allow Class A stations to choose
which facilities (analog or digital) to have evaluated for their
reverse auction bids will benefit these small entities. Alternatively,
the Commission could force many Class A stations to have their bids
evaluated based on their licensed analog facilities. The Commission
believes it would be unfair to those Class A licensees that have yet to
convert to digital operation and that made transition plans in reliance
on the rules we adopted just one year ago--months before passage of the
Spectrum Act--to limit bid evaluations to only those Class A facilities
licensed as of February 22, 2012. Class A stations will be permitted to
relinquish the facilities with the greatest value, thus maximizing the
return for their spectrum. This decision eliminates or minimizes
adverse economic impact on Class A stations which are small.
76. Because they will apply in the same way to all stations, the
Commission's proposals to not permit full power or Class A stations
with an expired or cancelled license to participate in the reverse
auction; to allow stations to participate in the reverse auction by
agreeing to relinquish a ``high VHF channel'' (channels 7-13) in
exchange for a ``low VHF channel'' (channels 2-6); and to allow
licensees to participate in the reverse auction by
[[Page 69983]]
relinquishing spectrum usage rights through the acceptance of
additional interference; would not have a significant impact on small
entities and any impact would affect all entities equally.
77. The Commission's proposal to prevent a licensee from proposing
a channel sharing arrangement in its reverse auction bid that would
result in a change in the station's community of license and/or DMA
would only affect full power television stations. The Commission
believes that the burden on small entities of not being able to propose
to change their communities of license in their reverse auction bid is
greatly outweighed by the need to avoid complicated allocation and
repacking issues. Following the conclusion of the incentive auction
process, stations will once again be permitted to propose changes to
their community of license.
78. As part of the rulemaking, we are seeking comment on the impact
on broadcasters of the different repacking approaches we are exploring,
including economic and other impacts. For example, the Commission
considers engineering and other technical aspects of the repacking
process, in particular Congress's mandate in Section 6403 of the
Spectrum Act that the Commission make all reasonable efforts to
preserve the coverage area and population served of television stations
in the repacking. Channel reassignments, and stations going off the air
as a result of the reverse auction, also may change the interference
relationships between stations, which relationships in turn affect
population served. The Commission's proposals must account for all of
these impacts in order to carry out Congress's mandate in Section 6403.
79. The unlicensed devices operating in this spectrum are designed
to adapt to whatever changes may occur in the spectrum that is
available at any given location. Therefore, since the equipment is so
flexible and will not have to be reconfigured, the Commission does not
currently anticipate any adverse economic impact on the relatively few
devices that are already deployed or devices that may be introduced in
the future. In the NPRM, the Commission seeks comment on a variety of
measures to ensure that spectrum in the TV bands will continue to be
available for unlicensed use, including measures that may increase
availability in many markets where little, if any, is available now.
Increasing the availability of spectrum for unlicensed use will benefit
small entities that use such spectrum for their various unlicensed
devices.
80. In the NPRM, the Commission explores retaining the use of
Channel 37 for wireless medical telemetry services and for radio
astronomy, as well as the possibility to relocate these users. In the
latter case, the Commission seeks comment on the possible economic and
other impacts on small, minority-owned, and women-owned small
businesses that such a relocation may have, including the availability
of other spectrum to support these uses.
81. The Commission proposes to only preserve, during repacking, the
service areas of television stations with regard to stations'
facilities that were licensed, or for which an application for license
to cover authorized facilities already was on file with the Commission,
as of February 22, 2012. This proposal would have little impact and any
impact would affect all entities equally. Alternatively, the Commission
could protect facilities in all pending facility modification
applications. However this would greatly complicate the repacking
analysis by increasing the amount of facilities under consideration.
Additionally, protection of both a licensed facility and a modification
thereto that would expand or alter the station's service area would
further encumber the spectrum, making it more difficult for the
Commission to complete the repacking of the broadcast spectrum.
82. As it did with respect to reverse auction bids by Class A
stations, the Commission also proposes that Class A stations elect
which facilities they would like protected in repacking. This proposal
will benefit small entities such as Class A stations by allowing these
stations to choose which facilities to be protected in repacking,
Alternatively, the Commission could only protect the Class A station's
licensed facilities as of February 22, 2012, but the Commission found
that that would be unfair since many Class A's are in the midst of
their digital transition; and moreover, failure to protect these
stations' unbuilt digital facilities could make it impossible for
certain Class A stations to effectuate their conversion plans, thus
stalling the digital transition.
83. The Commission proposes to only reimburse the expenses of full
power television and Class A stations that are repacked. Alternatively,
the Commission could reimburse low power television stations for their
repacking expenses. However, that would mean reimbursing stations such
as low power television stations that are secondary and that have no
expectation of being protected in the repacking process and would also
require an expenditure of reimbursement funds that could limit other
eligible stations from being fully reimbursed. The burden to small
entities such as low power television stations of having to fund their
own repacking expenses is outweighed by the intent of Congress to limit
reimbursement to only full power and Class A television stations and
that have spectrum rights that must be protected in repacking.
84. The Commission's proposal to limit reimbursement to
multichannel video programming distributors (MVPDs) as defined by
section 602 of the Communications Act \87\ would not have a significant
impact on small entities since the definition is very broad and will
enable providers affected by the incentive auction and repacking
processes to qualify to receive reimbursement.
---------------------------------------------------------------------------
\87\ The Communications Act defines MVPD ``as a person such as,
but not limited to, a cable operator, a multichannel multipoint
distribution service, a direct broadcast satellite service, or a
television receive-only satellite program distributor, who makes
available for purchase, by subscribers or customers, multiple
channels of video programming.'' 47 U.S.C. 522(13).
---------------------------------------------------------------------------
85. The proposal to reimburse stations and MVPDs based upon pre-
determined estimated amounts per station will benefit small entities
that cannot afford the expense of having to prepare formal
documentation for reimbursement. Alternatively, the Commission could
require all stations and MVPDs to prepare and file formal documentation
of all expenses. However, the benefit of having more accurate
reimbursement amounts is outweighed by the burden on small entities to
have to prepare and submit such a filing and the possible delay in the
completion of the reimbursement process which has a three-year
completion deadline.
86. The proposal to advance reimbursement payments to stations and
MVPDs, rather than making them go out-of-pocket for their expenses and
reimbursing them, would greatly benefit small entities that may not be
in the position financial to go out-of-pocket for their reimbursement
expenses. The alternative, to make stations pay for repacking costs
out-of-pocket, could would have a significant negative impact on small
entities and could substantially delay repacking and make it more
difficult to comply with the three-year reimbursement deadline set
forth in Section 6403 of the Spectrum Act.
87. The proposal to use a simplified, one-step process for
implementing the post-auction and post-repacking channel changes will
benefit small entities with limited resources. Rather than requiring
small entities to go through a prolonged two-step process of first
amending the DTV Table of Allotments and then filing an
[[Page 69984]]
application for its repacked facilities, the proposal allow stations to
file either a license application (for stations where no technical
changes are proposed such as channel sharing) or a minor change
application. In addition, the streamlined procedures are meant to
expedite the post-auction licensing and to ensure a smooth post-auction
transition and recovery of channels.
88. The proposal to allow stations to implement their post-auction
and repacking facilities on a phased timeline will benefit small
entities that may not have the resources to dedicate to the band
transition process. Transitioning stations will be able to rely on
either auction or reimbursement funds to construct their new
facilities. Allowing flexibility in the transition schedule, including
requests for additional time, will benefit small entities that may not
be able to rely on in-house employees and may have to rely on outside
contractors to complete construction of their new facilities.
89. The proposal to require all transitioning stations to inform
the public of the transition that will occur following the conclusion
of the incentive auction and implementation of repacking will have a
greater impact on small entities that may have to expend funds to
comply with the requirement or forego the airing of advertisements in
lieu of viewer notifications. However, the burden on small entities is
outweighed by the public's need to be informed of changes in stations'
channel assignments.
90. The NPRM contains a proposal to allow existing ownership
combinations rendered out of compliance due to channel allotments, or
technical changes resulting from repacking, to be permanently
``grandfathered.'' This proposal will benefit small entities that would
otherwise be forced to sell one or more of their media interests in
order to comply with the multiple ownership rules. A ``forced'' sale
would have to be done on an expedited basis and at a reduced price thus
resulting in a substantial burden on small entities.
91. To remediate the significant burden to low power television
stations, all of which are defined as small entities, from being
displaced as a result of repacking, the Commission proposes to allow
these stations to have the first opportunity to submit a displacement
application and propose a new operating channel. This proposal will
benefit small entities by allowing them to identify one of the
remaining channels and continue to operate their facilities and avoid
having to go off the air.
92. The proposal to require that all channel sharing agreements be
in writing; contain certain provisions concerning access to,
maintenance of, and modification of the shared transmission facilities;
and outline joint responsibility for compliance with certain of the
Commission's rules; may have a greater impact on small entities because
they may not have access to in-house personnel to prepare and review
these agreements. However, the burden on small entities to prepare a
channel sharing agreement with the requisite provisions is outweighed
by the need to ensure that channel sharing stations comply with the
Commission's rules and to prevent disputes that could result in a
disruption of service to the public.
93. The proposal to license the 600 MHz band under Economic Areas
(EA) geographic size licenses will provide regulatory parity with other
bands that provide wireless broadband services that are licensed on an
EA basis, such as the lower 700 MHz band licenses. Additionally,
assigning 600 MHz licenses in EA geographic areas would allow 600 MHz
licensees to make adjustments to suit their individual needs. EA
license areas are small enough to provide spectrum access opportunities
for smaller carriers. Depending on the licensing mechanism the
Commission adopts, licensees may adjust their geographic coverage
through auction or through secondary markets. This proposal should make
it easier for 600 MHz providers to enter secondary market arrangements
involving terrestrial use of their spectrum. The secondary market rules
apply equally to all entities, whether small or large. As a result, we
believe that this proposal will provide an economic benefit to small
entities by making it easier for entities, whether large or small, to
enter into secondary market arrangements for 600 MHz spectrum
94. The NPRM makes several proposals to protect entities operating
in nearby spectrum bands from harmful interference, which may include
small entities. The proposed technical rules are based on the rules for
700 MHz spectrum, with specific additions or modifications designed to
protect broadcast licensees, Radio Astronomy, and Wireless Medical
Telemetry Services. The technical analysis contained in the NPRM also
proposes that no additional rule modifications to protect other
spectrum bands are necessary. This proposal may help minimize the
impact on any small entities--both existing and potential small
entities that may seek to provide services using 600 MHz spectrum--by
streamlining regulations for operations in these spectrum bands.
95. The NPRM also proposes to provide 600 MHz licensees with the
flexibility to provide any fixed or mobile service that is consistent
with the allocations for this spectrum. This proposal is consistent
with other spectrum allocated or designated for licensed fixed and
mobile services, e.g., Lower 700 MHz. The NPRM further proposes to
license this spectrum under the Commission's market-oriented Part 27
rules. Proposals made pursuant to Part 27 include applying the
Commission's secondary market policies and rules to all transactions
involving the use of the 600 MHz band for terrestrial services, which
will provide greater predictability and regulatory parity with bands
licensed for terrestrial mobile broadband service. This proposal should
make it easier for 600 MHz providers to enter secondary market
arrangements involving terrestrial use of their spectrum. The secondary
market rules apply equally to all entities, whether small or large. As
a result, we believe that this proposal will provide an economic
benefit to small entities by making it easier for entities, whether
large or small, to enter into secondary market arrangements for 600 MHz
spectrum.
F. Federal Rules Which Duplicate, Overlap, or Conflict With the
Commission's Proposals
96. None.
List of Subjects
47 CFR Part 1
Administrative practice and procedure.
47 CFR Part 27
Communications common carriers. Radio.
47 CFR Part 73
Television.
Federal Communications Commission.
Marlene H. Dortch,
Secretary.
Rule Changes
For the reasons discussed in the preamble, the Federal
Communications Commission proposes to amend 47 CFR parts 1, 27, and 73
as follows:
PART 1--PRACTICE AND PROCEDURE
1. The authority citation for part 1 is revised to read as follows:
Authority: 15 U.S.C. 79 et seq.; 47 U.S.C. 151, 154(i), 154(j),
155, 157, 225, 227, 303(r)
[[Page 69985]]
and 309; Secs. 6004, 6403, Pub. L. 112-96, 125 Stat. 156.
2. Section 1.949 is amended by adding paragraph (c) to read as
follows:
Sec. 1.949 Application for renewal of license.
* * * * *
(c) Renewal Showing. An applicant for renewal of a geographic-area
authorization in the 600 MHz band must make a renewal showing,
independent of its performance requirements, as a condition of renewal.
The showing must include a detailed description of the applicant's
provision of service during the entire license period and address:
(1) The level and quality of service provided by the applicant
(e.g., the population served, the area served, the number of
subscribers, the services offered);
(2) The date service commenced, whether service was ever
interrupted, and the duration of any interruption or outage;
(3) The extent to which service is provided to rural areas;
(4) The extent to which service is provided to qualifying tribal
land as defined in Sec. 1.2110(f)(3)(i); and
(5) Any other factors associated with the level of service to the
public.
Sec. 1.2102 [Amended]
3. Section 1.2102 is amended by removing paragraph (c).
4. Section 1.2103 is revised to read as follows:
Sec. 1.2103 Competitive bidding design options.
(a) Public notice of competitive bidding design options. Prior to
any competitive bidding conducted by the Commission, public notice
shall be provided of the detailed procedures that may be used to
implement auction design options.
(b) Competitive bidding design options. The public notice detailing
competitive bidding procedures may establish procedures for collecting
bids, assigning winning bids, and determining payments, including
without limitation:
(1) Procedures for collecting bids. (i) Procedures for collecting
bids in a single round or in multiple rounds.
(ii) Procedures allowing for bids that specify a price, indicate
demand at a specified price, or provide other information as specified
by the Commission.
(iii) Procedures allowing for bids for specific items or bids for a
number of generic items in one or more categories of items.
(iv) Procedures allowing for bids that specify a bidder's
willingness to accept a price only in the event that other bids are
also accepted or other conditions are met, such as for packages of
licenses or contiguous licenses.
(v) Procedures to collect bids in any needed additional stage or
stages following an initial single or multiple round auction, such as
an assignment stage for generic items.
(2) Procedures for assigning winning bids. (i) Procedures that take
into account one or more factors identified by the Commission in
addition to the submitted bid amount, including but not limited to the
amount of bids submitted in separate competitive bidding conducted by
the Commission.
(ii) Procedures to incorporate public interest considerations into
the process for assigning winning bids.
(3) Procedures for determining payments. (i) Procedures to
determine the amount of any payments made to or by winning bidders
consistent with other auction design choices.
(ii) Procedures that provide for payments based on the amount as
bid or on the bid amount that would have been assigned winning status.
5. Section 1.2104 is amended by revising paragraph (e) to read as
follows:
Sec. 1.2104 Competitive bidding mechanisms.
* * * * *
(e) Stopping rules. The Commission may establish stopping rules
before or during multiple round auctions in order to terminate the
auctions within a reasonable time and in accordance with the goals,
statutory requirements, and rules for the auctions, including the
reserve price or prices.
* * * * *
6. Section 1.2105 is amended by adding paragraph (a)(2)(xii) to
read as follows:
Sec. 1.2105 Bidding application and certification procedures;
prohibition of certain communications.
(a) * * *
(2) * * *
(xii) For auctions required to be conducted under Title VI of the
Middle Class Tax Relief and Job Creation Act of 2012 (Pub. L. 112-96)
or in which any spectrum usage rights for which licenses are being
assigned were made available under 47 U.S.C. 309(j)(8)(G)(i), the
Commission may require certification under penalty of perjury that the
applicant and all of the person(s) disclosed under paragraph (a)(2)(ii)
of this section are not person(s) who have been, for reasons of
national security, barred by any agency of the Federal Government from
bidding on a contract, participating in an auction, or receiving a
grant. For the purposes of this certification, the term ``person''
means an individual, partnership, association, joint-stock company,
trust, or corporation, and the term ``reasons of national security''
means matters relating to the national defense and foreign relations of
the United States.
* * * * *
7. Section 1.9005 is amended by adding paragraph (kk) to read as
follows:
Sec. 1.9005 Included Services.
* * * * *
(kk) The 600 MHz band (part 27 of this chapter).
8. Subpart BB is added to part 1 to read as follows:
Subpart BB--Competitive Bidding--Broadcast Television Spectrum
Reverse Auction
Sec.
1.22000 Definitions.
1.22001 Purpose.
1.22002 Competitive bidding design options.
1.22003 Competitive bidding mechanisms.
1.22004 Applications to participate in competitive bidding.
1.22005 Prohibition of certain communications.
1.22006 Confidentiality of Commission-held data.
1.22007 Two competing participants required.
1.22008 Public notice of auction completion and auction results.
1.22009 Binding obligations.
1.22010 Disbursement of incentive payments.
Sec. 1.22000 Definitions.
For purposes of this subpart:
(a) Broadcast television licensee. The term broadcast television
licensee means the licensee of--
(1) A full-power television station; or
(2) A low-power television station that has been accorded primary
status as a Class A television licensee under Sec. 73.6001(a) of this
chapter.
(b) Forward auction. The term forward auction means the portion of
an incentive auction of broadcast television spectrum described in
section 6403(c) of the Spectrum Act.
(c) Relinquishment bid. The term relinquishment bid means a bid to
relinquish some or all of a broadcast television licensee's broadcast
television spectrum usage rights. Relinquishment bids include a bid to
relinquish all usage rights with respect to a particular television
channel without receiving in return any usage rights with respect to
another television channel; a bid to relinquish all usage rights with
respect to an ultra high frequency television channel in return for
receiving usage
[[Page 69986]]
rights with respect to a very high frequency television channel; a bid
to relinquish usage rights in order to share a television channel with
another licensee; and any other relinquishment bids permitted by the
Commission.
(d) Reverse auction. The term reverse auction means the portion of
an incentive auction of broadcast television spectrum described in
section 6403(a) of the Spectrum Act.
(e) Spectrum Act. The term Spectrum Act means Title VI of the
Middle Class Tax Relief and Job Creation Act of 2012 (Pub. L. 112-96).
Sec. 1.22001 Purpose.
The provisions of this subpart implement section 6403 of the
Spectrum Act, which requires the Commission to conduct a reverse
auction to determine the amount of compensation that each broadcast
television licensee would accept in return for voluntarily
relinquishing some or all of its broadcast television spectrum usage
rights in order to make spectrum available for assignment through a
system of competitive bidding under Subparagraph (G) of section
309(j)(8) of the Communications Act of 1934, as added by section 6402
of the Spectrum Act.
Sec. 1.22002 Competitive bidding design options.
(a) Public notice of competitive bidding design options. Prior to
conducting competitive bidding in the reverse auction, public notice
shall be provided of the detailed procedures that may be used to
implement auction design options.
(b) Competitive bidding design options. The public notice detailing
competitive bidding procedures for the reverse auction may establish
procedures for collecting bids, assigning winning bids, and determining
payments, including without limitation:
(1) Procedures for collecting bids. (i) Procedures for collecting
bids in a single round or in multiple rounds.
(ii) Procedures for collecting bids for multiple relinquishment
options.
(iii) Procedures allowing for bids that specify a price for a
relinquishment option, indicate demand at a specified price, or provide
other information as specified by the Commission.
(iv) Procedures allowing for bids that are contingent on specified
conditions, such as other bids being accepted.
(v) Procedures to collect bids in an additional stage or stages, if
needed, following an initial single or multiple round auction.
(2) Procedures for assigning winning bids. (i) Procedures for
scoring bids by factors in addition to bid amount, such as population
coverage or geographic contour, or other relevant measurable factors.
(ii) Procedures to evaluate the technical feasibility of assigning
a winning bid.
(A) Procedures that utilize mathematical computer optimization
software, such as integer programming, to evaluate bids and technical
feasibility, or that utilize other decision routines, such as
sequentially evaluating bids based on a ranking of scored bids.
(B) Procedures that combine computer optimization algorithms with
other decision routines.
(iii) Procedures to incorporate public interest considerations into
the process for assigning winning bids.
(3) Procedures for determining payments. (i) Procedures to
determine the amount of any incentive payments made to winning bidders
consistent with other auction design choices.
(ii) Procedures that provide for incentive payments based on the
amount as bid or on the highest bid amount that would have been
assigned winning status.
Sec. 1.22003 Competitive bidding mechanisms.
(a) Public Notice of competitive bidding procedures. Detailed
competitive bidding procedures shall be established by public notice
prior to the commencement of the reverse auction.
(b) Sequencing. The Commission will establish the sequencing with
which the reverse auction and the related forward auction assigning new
spectrum licenses will occur.
(c) Reserve price. The Commission may establish reserve prices,
either disclosed or undisclosed, above which relinquishment bids for
various bidding options would not win in the reverse auction. The
reserve prices may apply individually, in combination, or in the
aggregate.
(d) Opening bids and bid increments. The Commission may, by
announcement before or during the reverse auction, require maximum or
minimum bid increments in dollar or percentage terms. The Commission
also may establish maximum or minimum opening bids.
(e) Stopping rules. The Commission may establish stopping rules
before or during the reverse auction in order to terminate the auction
within a reasonable time and in accordance with the goals, statutory
requirements, and rules for the auction, including the reserve price or
prices.
(f) Activity rules. The Commission may establish activity rules
which require a minimum amount of bidding activity.
(g) Auction delay, suspension, or cancellation. By public notice or
by announcement during the reverse auction, the Commission may delay,
suspend, or cancel the auction in the event of a natural disaster,
technical obstacle, network disruption, evidence of an auction security
breach or unlawful bidding activity, administrative or weather
necessity, or for any other reason that affects the fair and efficient
conduct of the competitive bidding. The Commission also has the
authority, at its sole discretion, to resume the competitive bidding
starting from the beginning of the current or some previous round or
cancel the competitive bidding in its entirety.
Sec. 1.22004 Applications to participate in competitive bidding.
(a) Public notice of the application process. All applications to
participate must be filed electronically. The dates and procedures for
submitting applications to participate in the reverse auction shall be
announced by public notice.
(b) Applicant. The applicant identified on the application to
participate must be the broadcast television licensee that would
relinquish spectrum usage rights if it places a winning bid.
(c) Information and certifications provided in the application to
participate. The Commission may require an applicant to provide the
following information in its application to participate in the reverse
auction:
(1) The following identifying information:
(i) If the applicant is an individual, the applicant's name and
address. If the applicant is a corporation, the name and address of the
corporate office and the name and title of an officer or director. If
the applicant is a partnership, the name, citizenship, and address of
all general partners, and, if a general partner is not a natural
person, then the name and title of a responsible person for that
partner, as well. If the applicant is a trust, the name and address of
the trustee. If the applicant is none of the above, it must identify
and describe itself and its principals or other responsible persons;
(ii) Applicant ownership and other information as set forth in
section 1.2112(a) of this title; and
(iii) For NCE stations, information regarding the applicant's
governing board and any educational institution or governmental entity
with a controlling interest in the station, if applicable.
[[Page 69987]]
(2) The identity of the person(s) authorized to take binding action
in the bidding on behalf of the applicant.
(3) For each broadcast television license for which the applicant
intends to submit relinquishment bids:
(i) The identity of the station and the television channel;
(ii) Whether it is a full-power or Class A television station;
(iii) If the license is for a Class A television station,
certification that it is and will remain in compliance with the ongoing
statutory eligibility requirements to remain a Class A station;
(iv) Whether it is an NCE station, and if so, whether it operates
on a reserved or non-reserved channel;
(v) The types of relinquishment bids that the applicant may submit;
and
(vi) Any additional information required to assess the spectrum
usage rights offered.
(4) For each broadcast television license for which the applicant
intends to submit a bid to relinquish usage rights in order to share a
television channel with another licensee:
(i) The identity of the television channel that the applicant has
agreed to share with another licensee;
(ii) Any information regarding the channel sharing agreement
required by the Commission;
(iii) Certification that the channel sharing agreement is
consistent with all Commission rules and policies, and that the
applicant accepts any risk that the implementation of the channel
sharing agreement may not be feasible for any reason, including any
conflict with requirements for operation on the shared channel; and
(iv) Certification that its shared channel facilities will continue
to provide minimum coverage to its principal community of license as
set forth in the Commission's rules.
(5) Certification under penalty of perjury that the applicant and
all of the person(s) disclosed under paragraph (c)(1) of this section
are not person(s) who have been, for reasons of national security,
barred by any agency of the Federal Government from bidding on a
contract, participating in an auction, or receiving a grant. For the
purposes of this certification, the term ``person'' means an
individual, partnership, association, joint-stock company, trust, or
corporation, and the term ``reasons of national security'' means
matters relating to the national defense and foreign relations of the
United States.
(6) An exhibit, certified as truthful under penalty of perjury,
identifying all parties with whom the applicant has entered into
partnerships, joint ventures, consortia, or other agreements,
arrangements, or understandings of any kind relating to the spectrum
usage rights being auctioned, including any such agreements relating to
the post-auction market structure.
(7) Certification under penalty of perjury that the applicant has
not entered and will not enter into any explicit or implicit
agreements, arrangements, or understandings of any kind with any
parties other than those identified pursuant to paragraph (c)(6) of
this section regarding the amount of their bids, bidding strategies, or
the particular relinquishment bids that they will or will not submit.
(8) An exhibit identifying all current delinquencies on any non-tax
debt owed to any Federal agency.
(9) Certification that the applicant agrees that it has sole
responsibility for investigating and evaluating all technical and
marketplace factors that may have a bearing on the bids it submits in
the reverse auction.
(10) Certification that the applicant agrees that the bids it
submits in the reverse auction are irrevocable, binding offers by the
applicant.
(11) Certification that the individual submitting the application
to participate and providing the certifications is authorized to do so
on behalf of the applicant, and if such individual is not an officer,
director, board member, or controlling interest holder of the
applicant, evidence that such individual has the authority to bind the
applicant.
(12) Certification that the applicant is in compliance with all
statutory and regulatory requirements for participation in the reverse
auction, including any requirements with respect to the license(s)
identified in the application to participate.
(13) Such additional information as the Commission may require.
(d) Application processing. (1) Any timely submitted application to
participate will be reviewed by Commission staff for completeness and
compliance with the Commission's rules. No untimely applications to
participate shall be reviewed or considered.
(2) Any application to participate that does not contain all of the
certifications required pursuant to this section is unacceptable for
filing, cannot be corrected subsequent to the application filing
deadline, and will be dismissed with prejudice.
(3) The Commission will provide bidders a limited opportunity to
cure specified defects and to resubmit a corrected application to
participate. During the resubmission period for curing defects, an
application to participate may be amended or modified to cure defects
identified by the Commission or to make minor amendments or
modifications. After the resubmission period has ended, an application
to participate may be amended or modified to make minor changes or
correct minor errors in the application to participate. Minor
amendments may be subject to a deadline specified by public notice.
Major amendments cannot be made to an application to participate after
the initial filing deadline. Major amendments include, but are not
limited to, changes in ownership of the applicant that would constitute
an assignment or transfer of control, changes to any of the required
certifications, and the addition or removal of licenses identified on
the application to participate for which the applicant intends to
submit relinquishment bids. Minor amendments include any changes that
are not major, such as correcting typographical errors and supplying or
correcting information requested by the Commission to support the
certifications made in the application.
(4) Applicants who fail to correct defects in their applications to
participate in a timely manner as specified by public notice will have
their applications to participate dismissed with no opportunity for
resubmission.
(5) Applicants shall have a continuing obligation to make any
amendments or modifications that are necessary to maintain the accuracy
and completeness of information furnished in pending applications to
participate. Such amendments or modifications shall be made as promptly
as possible, and in no case more than five business days after
applicants become aware of the need to make any amendment or
modification, or five business days after the reportable event occurs,
whichever is later. An applicant's obligation to make such amendments
or modifications to a pending application to participate continues
until they are made.
(e) Notice to qualified and non-qualified applicants. The
Commission will notify each applicant as to whether it is qualified or
not qualified to participate in the reverse auction.
Sec. 1.22005 Prohibition of certain communications.
(a) Definition of applicant. For purposes of this section, the term
``applicant'' shall include the entity submitting an application to
participate in the reverse auction, all controlling interests in the
entity submitting the application to participate, as well as all
[[Page 69988]]
holders of partnership and other ownership interests and any stock
interest amounting to ten percent or more of the entity, or outstanding
stock, or outstanding voting stock of the entity submitting the
application to participate, and all officers and directors of that
entity. For NCEs, the term ``applicant'' shall also include all members
of the licensee's governing board.
(b) Certain communications prohibited. After the deadline for
submitting applications to participate in the reverse auction, an
applicant is prohibited from cooperating or collaborating with any
other applicant with respect to its own, or one another's, or any other
applicant's bids or bidding strategies, and is prohibited from
communicating with any other applicant directly or indirectly in any
manner the substance of its own, or one another's, or any other
applicant's bids or bidding strategies, until a date specified by
public notice.
(c) Duty to report potentially prohibited communications. An
applicant that makes or receives a communication that may be prohibited
under paragraph (b) of this section shall report such communication in
writing to Commission staff immediately, and in any case no later than
five business days after the communication occurs. An applicant's
obligation to make such a report continues until the report has been
made.
(d) Procedures for reporting potentially prohibited communications.
Particular procedures for parties to report communications that may be
prohibited under paragraph (b) of this section may be established by
public notice. If no such procedures are established by public notice,
the party making the report shall do so in writing to the Chief of the
Auctions and Spectrum Access Division, Wireless Telecommunications
Bureau, by the most expeditious means available, including electronic
transmission such as email.
Sec. 1.22006 Confidentiality of Commission-held data.
The Commission will take all reasonable steps necessary to protect
the confidentiality of Commission-held data of a broadcast television
licensee participating in the reverse auction, including withholding
the identity of such licensee, until the reassignments and
reallocations (if any) under section 6403(b)(1)(B) of the Spectrum Act
become effective.
Sec. 1.22007 Two competing participants required.
The Commission may not enter into an agreement for a broadcast
television licensee to relinquish broadcast television spectrum usage
rights in exchange for a share of the proceeds from the related forward
auction assigning new spectrum licenses unless at least two competing
broadcast television licensees participate in the reverse auction.
Sec. 1.22008 Public notice of auction completion and auction results.
Public notice shall be provided when the reverse auction is
complete and when the forward auction is complete. Public notice shall
be provided of the results of the reverse auction, forward auction, and
repacking, and shall indicate that the reassignments of television
channels and reallocations of broadcast television spectrum are
effective.
Sec. 1.22009 Binding obligations.
A bidder in the reverse auction assumes an irrevocable, binding
obligation to relinquish its spectrum usage rights upon placing a
winning bid. Winning bidders will relinquish the spectrum usage rights
associated with any winning bids by a date specified by public notice.
Sec. 1.22010 Disbursement of incentive payments.
A winning bidder shall submit to the Commission the necessary
financial information to facilitate the disbursement of the winning
bidder's incentive payment. Specific procedures for submitting
financial information, including applicable deadlines, will be set out
by public notice.
PART 27--MISCELLANEOUS WIRELESS COMMUNICATIONS SERVICES
9. The authority citation for part 27 continues to read as follows:
Authority: 47 U.S.C. 154, 301, 302, 303, 307, 309, 332, 336, and
337 unless otherwise noted.
10. Section 27.1 is amended by adding paragraph (b)(10) to read as
follows:
Sec. 27.1 Basis and purpose.
* * * * *
(b) * * *
(10) Spectrum in the 470-698 MHz UHF band that has been reallocated
and redesignated for flexible fixed and mobile use pursuant to Section
6403 of the Middle Class Tax Relief and Job Creation Act of 2012,
Public Law 112-96, 125 Stat. 156.
* * * * *
11. Section 27.4 is amended by adding in alphanumeric order the
definition entitled ``600 MHz service'' to read as follows:
Sec. 27.4 Terms and definitions.
600 MHz service. A radiocommunication service licensed pursuant to
this part for the frequency bands specified in Sec. 27.5(j).
* * * * *
12. Section 27.5 is amended by adding paragraph (j) to read as
follows:
Sec. 27.5 Frequencies.
* * * * *
(j) 600 MHz band. In accordance with the terms and conditions
established in Docket No. 12-268, pursuant to Section 6403 of the
Middle Class Tax Relief and Job Creation Act of 2012, Public Law 112-
96, 125 Stat. 156, the following frequencies are available for
licensing pursuant to this part in the 600 MHz band:
(1) [XX] channel blocks of 5 megahertz each are available for
assignment for uplink communications (hereinafter the 600 MHz uplink
band).
(2) [XX] channel blocks of 5 megahertz each are available for
assignment for downlink communications (hereinafter the 600 MHz
downlink band).
Note to paragraph (j): The specific frequencies and number of
channel blocks will be determined in light of further proceedings
pursuant to Docket No. 12-268 and the rule will be updated accordingly.
13. Section 27.6 is amended by adding paragraph (i) to read as
follows:
Sec. 27.6 Service areas.
* * * * *
(i) 600 MHz band. Service areas for the 600 MHz band prescribed in
Sec. 27.5 are based on Economic Areas (EAs) as defined in paragraph
(a) of this section.
14. Section 27.11 is amended by adding paragraph (j) to read as
follows:
Sec. 27.11 Initial authorization.
* * * * *
(j) 600 MHz band. Initial authorizations for the 600 MHz band shall
be for 5 megahertz of spectrum in accordance with Sec. 27.5(j).
Authorizations will be based on Economic Areas (EAs), as specified in
Sec. 27.6(a).
15. Section 27.13 is amended by adding paragraph (i) to read as
follows:
Sec. 27.13 License period.
* * * * *
[[Page 69989]]
(i) 600 MHz band. Authorizations for the 600 MHz band will have a
term not to exceed ten years from the date of issuance or renewal.
16. Section 27.14 is amended by revising the first sentence of
paragraph (f) to read as follows:
Sec. 27.14 Construction requirements; criteria for renewal.
* * * * *
(f) Comparative renewal proceedings do not apply to WCS licensees
holding authorizations for the 600 MHz, 698-746 MHz, 747-762 MHz, and
777-792 MHz bands. * * *
* * * * *
17. Section 27.15 is amended by revising paragraph (d)(1)(i);
adding paragraph (d)(1)(iii); revising paragraph (d)(2)(i), and adding
paragraph (d)(2)(iii) to read as follows:
Sec. 27.15 Geographic partitioning and spectrum disaggregation.
* * * * *
(d) * * *
(1) * * *
(i) Except for WCS licensees holding authorizations for the 600 MHz
band, Block A in the 698-704 MHz and 728-734 MHz bands, Block B in the
704-710 MHz and 734-740 MHz bands, Block E in the 722-728 MHz band,
Blocks C, C1, or C2 in the 746-757 MHz and 776-787 MHz bands, or Block
D in the 758-763 MHz and 788-793 MHz bands, the following rules apply
to WCS and AWS licensees holding authorizations for purposes of
implementing the construction requirements set forth in Sec. 27.14.
Parties to partitioning agreements have two options for satisfying the
construction requirements set forth in Sec. 27.14. Under the first
option, the partitioner and partitionee each certifies that it will
independently satisfy the substantial service requirement for its
respective partitioned area. If a licensee subsequently fails to meet
its substantial service requirement, its license will be subject to
automatic cancellation without further Commission action. Under the
section option, the partitioner certifies that it has met or will meet
the substantial service requirement for the entire, pre-partitioned
geographic service area. If the partitioner subsequently fails to meet
its substantial service requirement, only its license will be subject
to automatic cancellation without further Commission action.
* * * * *
(iii) For licensees in the 600 MHz band, the following rules apply
for purposes of implementing the construction requirements set forth in
Sec. 27.14. Each party to a geographic partitioning must individually
meet any service-specific performance requirements (i.e., construction
and operation requirements).
(2) * * *
(i) Except for WCS licensees holding authorizations for the 600 MHz
band, Block A in the 698-704 MHz and 728-734 MHz bands, Block B in the
704-710 MHz and 734-740 MHz bands, Block E in the 722-728 MHz band,
Blocks C, C1, or C2 in the 746-757 MHz and 776-787 MHz bands, or Block
D in the 758-763 MHz and 788-793 MHz bands, the following rules apply
to WCS and AWS licensees holding authorizations for purposes of
implementing the construction requirements set forth in Sec. 27.14.
Parties to disaggregation agreements have two options for satisfying
the construction requirements set forth in Sec. 27.14. Under the first
option, the disaggregator and disaggregatee each certifies that it will
share responsibility for meeting the substantial service requirement
for the geographic service area. If the parties choose this option and
either party subsequently fails to satisfy its substantial service
responsibility, both parties' licenses will be subject to forfeiture
without further Commission action. Under the second option, both
parties certify either that the disaggregator or the disaggregatee will
meet the substantial service requirement for the geographic service
area. If the parties choose this option, and the party responsible
subsequently fails to meet the substantial service requirement, only
that party's license will be subject to forfeiture without further
Commission action.
* * * * *
(iii) For licensees holding authorizations in the 600 MHz band, the
following rules apply for purposes of implementing the construction
requirements set forth in Sec. 27.14. Each party to a spectrum
disaggregation must individually meet any service-specific performance
requirements (i.e., construction and operation requirements).
18. Section 27.17 is added to read as follows:
Sec. 27.17 Discontinuance of service in the 600 MHz band.
(a) Termination of Authorization. A licensee's authorization in the
600 MHz band will automatically terminate, without specific Commission
action, if it permanently discontinues service after meeting the
interim buildout requirements.
(b) Permanent discontinuance of service is defined as 180
consecutive days during which a 600 MHz licensee does not operate or,
in the case of a commercial mobile radio service provider, does not
provide service to at least one subscriber that is not affiliated with,
controlled by, or related to the providing carrier.
(c) Filing Requirements. A licensee of the 600 MHz band that
permanently discontinues service as defined in this section must notify
the Commission of the discontinuance within 10 days by filing FCC Form
601 or 605 requesting license cancellation. An authorization will
automatically terminate, without specific Commission action, if service
is permanently discontinued as defined in this section, even if a
licensee fails to file the required form requesting license
cancellation.
19. Section 27.50 is amended by revising paragraphs (c)
introductory text, (c)(5), (c)(9), (c)(10), and the heading to Tables 1
through 4 to read as follows:
Sec. 27.50 Power limits and duty cycle.
* * * * *
(c) The following power and antenna height requirements apply to
stations transmitting in the 698-746 MHz band and the 600 MHz downlink
band:
* * * * *
(5) Licensees, except for licensees operating in the 600 MHz
downlink band, seeking to operate a fixed or base station located in a
county with population density of 100 or fewer persons per square mile,
based upon the most recently available population statistics from the
Bureau of the Census, and transmitting a signal at an ERP greater than
1000 watts must:
* * * * *
(9) Control and mobile stations are limited to 30 watts ERP in the
698-746 MHz band and 3 watts ERP in the 600 MHz uplink band but are
precluded in the 600 MHz downlink band;
(10) Portable stations (hand-held devices) are limited to 3 watts
ERP in the 698-746 MHz band and the 600 MHz uplink band but are
precluded in the 600 MHz downlink band; and
* * * * *
Table 1 to Sec. 27.50--Permissible Power and Antenna Heights for
Base and Fixed Stations in the 757-758 and 775-776 MHz Bands and for
Base and Fixed Stations in the 600 MHz, 698-757 MHz, 758-763 MHz, 776-
787 MHz and 788-793 MHz Bands Transmitting a Signal With an Emission
Bandwidth of 1 MHz or Less
* * * * *
Table 2 to Sec. 27.50--Permissible Power and Antenna Heights for
Base and Fixed Stations in the 600 MHz, 698-757 MHz, 758-763 MHz, 776-
787 MHz and 788-
[[Page 69990]]
793 MHz Bands Transmitting a Signal With an Emission Bandwidth of 1 MHz
or Less
* * * * *
Table 3 to Sec. 27.50--Permissible Power and Antenna Heights for
Base and Fixed Stations in the 600 MHz, 698-757 MHz, 758-763 MHz, 776-
787 MHz and 788-793 MHz Bands Transmitting a Signal With an Emission
Bandwidth Greater than 1 MHz
* * * * *
Table 4 to Sec. 27.50--Permissible Power and Antenna Heights for
Base and Fixed Stations in the 600 MHz, 698-757 MHz, 758-763 MHz, 776-
787 MHz and 788-793 MHz Bands Transmitting a Signal With an Emission
Bandwidth Greater than 1 MHz
* * * * *
20. Section 27.53 is amended by revising paragraph (g) to read as
follows:
Sec. 27.53 Emission limits.
* * * * *
(g) For operations in the 600 MHz and 698-746 MHz bands, the power
of any emission outside a licensee's frequency band(s) of operation
shall be attenuated below the transmitter power (P) within the licensed
band(s) of operation, measured in watts, by at least 43 + 10 log (P)
dB. Compliance with this provision is based on the use of measurement
instrumentation employing a resolution bandwidth of 100 kilohertz or
greater. However, in the 100 kilohertz bands immediately outside and
adjacent to a licensee's frequency block, a resolution bandwidth of at
least 30 kHz may be employed.
* * * * *
21. Section 27.55 is amended by revising paragraphs (a)(2) and (b)
to read as follows:
Sec. 27.55 Power strength limits.
* * * * *
(a) * * *
(2) 600 MHz, 698-758, and 775-787 MHz bands: 40 dB[micro]V/m.
* * * * *
(b) Power flux density limit for stations operating in the 698-746
MHz band and the 600 MHz band. For base and fixed stations operating in
the 698-746 MHz band and the 600 MHz band in accordance with the
provisions of Sec. 27.50(c)(6), the power flux density that would be
produced by such stations through a combination of antenna height and
vertical gain pattern must not exceed 3000 microwatts per square meter
on the ground over the area extending to 1 km from the base of the
antenna mounting structure.
* * * * *
22. Subpart O is added to part 27 to read as follows:
Subpart O--Competitive Bidding Procedures for the 600 MHz Band
Sec.
27.1401 600 MHz band subject to competitive bidding.
27.1402 Designated entities in the 600 MHz band.
Sec. 27.1401 600 MHz band subject to competitive bidding.
Mutually exclusive initial applications for licenses in the 600 MHz
band (i.e., the frequency bands specified in Sec. 27.5(j)) are subject
to competitive bidding. The general competitive bidding procedures set
forth in part 1, subpart Q of this chapter will apply unless otherwise
provided in this subpart.
Sec. 27.1402 Designated entities in the 600 MHz band.
(a) Eligibility for small business provisions. (1) A small business
is an entity that has average attributable gross revenues, as
determined pursuant to Sec. 1.2110 of this chapter, not exceeding $40
million for the preceding three years.
(2) A very small business is an entity that has average
attributable gross revenues, as determined pursuant to Sec. 1.2110 of
this chapter, not exceeding $15 million for the preceding three years.
(b) Bidding credits. (1) A winning bidder that qualifies as a small
business, as defined in this section, or a consortium of small
businesses may use the bidding credit specified in Sec.
1.2110(f)(2)(iii) of this chapter.
(2) A winning bidder that qualifies as a very small business, as
defined in this section, or a consortium of very small businesses may
use the bidding credit specified in Sec. 1.2110(f)(2)(ii) of this
chapter.
PART 73--RADIO BROADCAST SERVICES
23. The authority citation for part 73 continues to read:
Authority: 47 U.S.C. 154, 303, 334, 336, and 339.
24. Section 73.3572 is amended by adding paragraph (a)(4)(vi) to
read as follows:
Sec. 73.3572 Processing of TV broadcast, Class A TV broadcast, low
power TV, TV translators, and TV booster applications.
* * * * *
(a) * * *
(4) * * *
(vi) Low power television and TV translators displaced as a result
of the broadcast television incentive auction set forth in 47 CFR
73.3700 shall be permitted to submit an application for displacement
relief in a restricted filing window announced by the Media Bureau by
Public Notice. Priority processing shall be afforded to mutually
exclusive applications filed by low power television stations or TV
translators that provide the only local over-the-air television service
within their protected service area as set forth in Sec. 74.792 of
this chapter.
* * * * *
25. Section 73.3700 is revised to read as follows:
Sec. 73.3700 Reverse auction provisions.
(a) Definitions. (1) High VHF Channel. For purposes of this
paragraph, ``High VHF Channel'' means a television channel located
between the frequencies from 174 MHz to 216 MHz (television channels 7
through 13).
(2) Reverse auction. For purposes of this paragraph, ``reverse
auction'' means the auction set forth in Section 6403(a) of the Middle
Class Tax Relief and Job Creation Act of 2012.
(3) Low VHF Channel. For purposes of this paragraph, ``Low VHF
Channel'' means a television channel located between the frequencies
from 54 MHz to 72 MHz and 76 MHz to 88 MHz (television channels 2
through 6).
(4) MVPD. For purposes of this paragraph, ``MVPD'' means a person
such as, but not limited to, a cable operator, a multichannel
multipoint distribution service, a direct broadcast satellite service,
or a television receive-only satellite program distributor, who makes
available for purchase, by subscribers or customers, multiple channels
of video programming as set forth in section 602 of the Communications
Act of 1934 (47 U.S.C. 522).
(5) Repacking. For purposes of this paragraph, ``repacking'' means
the reorganization of the broadcast television spectrum, including the
reassignment of channels in conjunction with the reverse auction, as
set forth in Section 6403(b) of the Middle Class Tax Relief and Job
Creation Act of 2012.
(6) Television station. For purposes of this paragraph,
``television station'' means full power television stations and Class A
television stations.
(7) Ultra High Frequency Television Channel. For purposes of this
paragraph, ``ultra high frequency television channel'' (``UHF'') means
a television channel that is located in the portion of the
electromagnetic spectrum between the frequencies from 470 MHz to 698
MHz (television channels 14 through 51).
[[Page 69991]]
(8) Very High Frequency Television Channel. For purposes of this
paragraph, ``very high frequency television channel'' (``VHF'') means a
television channel that is located in the portion of the
electromagnetic spectrum between the frequencies from 54 MHz to 72 MHz,
from 76 MHz to 88 MHz, or from 174 MHz to 216 MHz (television channels
2 through 13).
(b) Participation in reverse auction. (1) A television station
licensee or holder of a construction permit for a newly authorized
unbuilt station, may participate in the reverse auction so long as it
holds a license for the spectrum it seeks to relinquish prior to the
date it submits its application to participate in the reverse auction.
(2) Noncommercial educational (NCE) television stations may
participate in the reverse auction.
(3) Television stations may participate in the reverse auction
regardless of whether they are subject to any pending complaints or
investigations related to the spectrum being contributed to the
incentive auction, unless such complaints or investigations have
resulted in a revocation or non-renewal of the station's license.
(c) Channel sharing. Each licensee participating in a channel
sharing arrangement shall continue to be licensed and operated
separately, have its own call sign and be separately subject to all of
the Commission's obligations, rules, and policies applicable to the
television service.
(1) Channel sharing arrangements involving full power television
and class A television stations.
(i) Channel sharing is permissible between full power television
stations, between Class A television stations and between full power
and Class A television stations.
(ii) A Class A television station that relinquishes usage rights to
its channel in order to share a channel with a full power television
station pursuant to this paragraph will be licensed with the technical
facilities of the full power television station, but must comply in all
other respects with the rules and policies applicable to Class A
stations as set forth in the Community Broadcasters Protection Act of
1999 and 47 CFR subpart J.
(iii) A full power television station that relinquishes usage
rights to its channel in order to share a channel with a Class A
television station pursuant to this paragraph will be licensed with the
part 74 technical facilities of the Class A television station as set
forth in part 74 of this chapter but must continue to comply with the
provisions in part 73, subpart E except for those that are inconsistent
with the part 74 technical requirements.
(iv) A Class A television station sharing a channel with a full
power television station pursuant to this paragraph may only qualify
for the cable carriage rights afforded ``qualified low power television
stations'' in 47 CFR 76.56(b)(3).
(2) Channel Sharing Between Commercial and Noncommercial
Educational Television Stations.
(i) Channel sharing is permissible between commercial and NCE
television stations.
(ii) An NCE television station licensee that relinquishes a channel
reserved for NCE use to share a channel that has not been reserved for
NCE use will retain its NCE status while operating on the non-reserved
channel and must continue to comply with the requirements set forth in
47 CFR 73.621 and Commission policies related to NCE television
stations. The NCE licensee may only assign or transfer its shared
license to an entity qualified in that rule section to become an NCE
television licensee.
(iii) An NCE television station licensee sharing a channel reserved
for NCE use with a commercial television station licensee will retain
its NCE status and the commercial licensee will retain its commercial
status. The NCE licensee must continue to comply with the requirements
set forth in 47 CFR 73.621 and Commission policies related to NCE
television stations, and may only assign or transfer its shared license
to an entity qualified in that rule section to become an NCE television
licensee.
(3) Required channel sharing agreement provisions. Channel Sharing
Agreements shall contain provisions that:
(i) Ensure that each licensee shall retain sufficient spectrum
usage rights to operate one Standard Definition (SD) program stream.
(ii) Ensure that each licensee has reasonable access rights to its
shared transmission facilities and is able to operate without
limitation.
(iii) Set forth each licensee's rights and responsibilities with
respect to maintenance of the shared transmission facilities.
(iv) Specify procedures for licensees to propose and implement
modifications to shared transmission facilities.
(v) Provide for the rights of each licensee in the event of
assignment or transfer of one of the channel sharing stations to a
third party.
(4) Changes to community of license or market designation. Stations
may not propose any channel sharing arrangement that would result in a
change in the stations' community of license or DMA.
(5) Preservation of carriage rights. A broadcast television station
that voluntarily relinquishes spectrum usage rights under this
paragraph in order to share a television channel and that possessed
carriage rights under section 338, 614, or 615 of the Communications
Act of 1934 (47 U.S.C. 338; 534; 535) on November 30, 2010, shall have,
at its shared location, the carriage rights under such section that
would apply to such station at such location if it were not sharing a
channel.
(d) Protection of licensed facilities during repacking. Only the
licensed facilities of television stations as they existed on February
22, 2012 shall be protected during the repacking of the broadcast
television spectrum.
(1) Class A television stations. A Class A television station that
has not completed its conversion to digital operations shall be
afforded an opportunity prior to completion of the repacking process to
specify an authorized digital facility for which it requests protection
during repacking.
(2) [Reserved].
(e) Post-auction licensing. (1) Applications. Following the
announcement of the results of the reverse auction and repacking plan,
all stations that have been reassigned to a new channel (excluding a
channel sharing station moving to a channel that has not been repacked)
must file a minor change application for a construction permit using
FCC Forms 301-DTV, 301-CA or 340-DTV by the date specified. Channel
sharing stations must each file an application for license using FCC
Form 302-DTV by the date specified.
(2) Deadlines. (i) Stations relinquishing channels. A television
station licensee that wins its reverse auction bid to relinquish a
channel without receiving in return any usage rights with respect to
another channel must comply with the notification and cancellation
procedures in 47 CFR 73.1750 and terminate operations on the
relinquished channel within [XX] months of notification that it is a
winning bidder.
(ii) Channel-sharing stations. A licensee that wins its reverse
auction bid to relinquish a channel pursuant to a CSA must comply with
the notification and cancellation procedures in 47 CFR 73.1750 and
terminate operations on the relinquished channel within [XX] months of
issuance of notification that it is a winning bidder, even if the
shared channel has also been repacked.
[[Page 69992]]
(iii) Stations moving from a UHF to VHF channel and repacked
stations. A licensee that wins its reverse auction bid to move from a
UHF to a VHF channel, and a station reassigned to a new channel in the
repacking plan, must terminate operation on its former channel and
begin operation on its new channel within 18 months of issuance of
notification that it is a winning bidder or that it has been assigned a
new channel during repacking.
(3) Requests for additional time to complete construction. Stations
subject to the deadlines in Sec. 73.3700(e)(2) may seek additional
time to terminate operations on their former channel facilities and,
where applicable, to complete construction of their new channel
facilities.
(4) Consumer education. Stations subject to the deadlines in Sec.
73.3700(e)(2) must provide notice to their viewers of their planned
termination of operations and, if applicable, relocation to a new
channel.
(5) Notice to MVPDs. Winning bidders in the reverse auction and
repacked stations shall notify MVPDs in writing of any changes to the
stations' channel or technical facilities that could affect carriage.
Such notification shall be provided not less than [XX] days prior to
implementation of changes in conjunction with the channel sharing
arrangement.
(f) Compensation. (1) Television stations are eligible for
reimbursement of the costs reasonably incurred as a result of their
channels being reassigned through repacking.
(2) MPVDs are eligible for reimbursement of the costs reasonably
incurred in order to continue to carry the signal of a television
station that has its channel changed as part of repacking or that
relinquishes its spectrum rights through the incentive auction.
(3) Amount of reimbursement. (i) Television stations may elect to
be reimbursed through an advance payment based upon an estimated rate
per station or may submit a showing and be reimbursed based upon their
actual expenditures incurred in the repacking process.
(ii) MVPDs may elect to be reimbursed through an advance payment
based upon an estimated rate per station change or may submit a showing
and be reimbursed based upon their actual expenditures incurred to
accommodate changes that result from the reverse auction or repacking
processes.
(4) In lieu of receiving reimbursement of their costs reasonably
incurred as a result of their channels being reassigned through
repacking, a television station may accept a waiver of the service
rules to permit the television station to provide services other than
broadcast television services. Such waiver shall only remain in effect
while the licensee provides at least one broadcast television program
stream on such spectrum at no charge to the public.
26. Section 73.6012 is revised to read as follows:
Sec. 73.6012 Protection of Class A TV, low power TV and TV translator
stations.
An application to change the facilities of an existing Class A TV
station will not be accepted if it fails to protect other authorized
Class A TV, low power TV and TV translator stations and applications
for changes in such stations filed prior to the date the Class A
application is filed, pursuant to the requirements specified in Sec.
74.707 of this chapter. The protection of other authorized low power TV
and TV translator stations and applications for changes in such
stations shall not apply in connection with any application filed by a
Class A TV station to implement the reorganization of broadcast
spectrum authorized in section 6403(b) of the Middle Class Tax Relief
and Job Creation Act of 2012.
27. Section 73.6019 is revised to read as follows:
Sec. 73.6019 Digital Class A TV station protection of low power TV,
TV translator, digital low power TV and digital TV translator stations.
An application for digital operation of an existing Class A TV
station or to change the facilities of a digital Class A TV station
will not be accepted if it fails to protect authorized low power TV, TV
translator, digital low power TV and digital TV translator stations in
accordance with the requirements of Sec. 74.793 (b) through (d) and
(h) of this chapter. This protection must be afforded to applications
for changes filed prior to the date the digital Class A station is
filed. The protection of other authorized low power TV, TV translator,
digital low power TV and digital TV translator stations shall not apply
in connection with any application filed by a Class A TV station to
implement the reorganization of broadcast spectrum authorized in
section 6403(b) of the Middle Class Tax Relief and Job Creation Act of
2012.
[FR Doc. 2012-27235 Filed 11-20-12; 8:45 am]
BILLING CODE 6712-01-P